The Roadmap

to Open Finance
in the UK
KPMG & Innovate Finance

1 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

Foreword
Open Banking in the UK has been a driving force for innovation. • Identify a set of scenarios or route options for the roadmap.
New legislation will shortly give ministers the powers to extend
open or smart data to other areas of financial services as well • Identify some of the common principles and infrastructures
as other sectors like energy and retail1. This can provide the needed for any journey option.
basis for Open Finance across all financial services including
• Provide a framework for deciding on the UK’s route to Open
savings, mortgages and assets, credit, insurance and
Finance - identifying the trade-offs involved in different
investment. This has the power to unlock huge economic and
approaches and how data sets and use cases can be
social benefit, enabling consumers and businesses to easily
prioritised.
view and manage their entire balance sheet and make finance
work better for them. Our aim is to provide a framework and provocation for
conversation and debate, to help develop thinking on what the
To realise the benefits, we have to answer the question: how do
right roadmap (or roadmaps) should be for Open Finance in
we get there? How do we extend consent-based, data-driven
the UK. We want a big conversation across the ecosystem: with
services across datasets currently held in numerous financial
users and consumers; all financial services and institutions;
service providers to unlock new use cases and innovative
FinTechs; BigTech; regulators; policymakers and government.
services and products. We need a roadmap for Open Finance,
We want to involve as many people as possible to help refine
setting out the journey to data sharing in and across all
and develop the UK roadmap for Open Finance and to provide
financial services.
a framework and input to any task force that may take this
Work is just starting to develop this roadmap. This report is forward.
designed to aid that process. It aims to:
We will be organising further discussions and we hope you will
• Summarise where we are starting the journey: what has use this as a tool for your own discussions. Let us know what you
already been achieved or is underway. think - what is your preferred route to Open Finance?

• Highlight additional building blocks needed to enable the

implementation of Open Finance.

Janine Hirt Ellie Hewitt

CEO, Innovate Finance Open Finance Lead, KPMG

2 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

Introduction
Open Finance is one of the most potentially transformative multi-faceted opportunity, that requires equally holistic,
innovations currently facing the financial sector. Open Finance pan-industry response to maximise its potential. A successful
refers to the portability of data, within and across financial rollout therefore requires close collaboration between key
services, with the consumer in charge of their own data. New stakeholders across public and private sectors: government,
solutions could incorporate real time financing embedded at regulators and industry players.
the point of sale, democratise financial advice, streamline
lending and offer more holistic money management. This Innovate Finance recently published its General Election FinTech
means the consumer will be able to manage their finances Manifesto, calling on the next government to focus on three key
more effectively by obtaining financial advice currently areas towards achieving this vision. These areas have been
restricted to those that can pay. This would benefit near term identified as enablers for the UK to lead the next wave of FinTech
cost of living challenges and long term consumer savings. An innovation and solidify the country as the best place in the
Open Finance economy would also drive productivity benefits world to start, scale and build a FinTech.
for millions of small businesses across the country.
To build the world’s first smart data economy, Innovate Finance
The use case potential for Open Finance is vast. Report by CFIT called for a 5-year roadmap of extending Open Banking to
stated that delivering Open Finance and personal data mobility Open Finance - with open data in all financial sectors by 2030,
could boost UK GDP by £30.5bn a year2. Smart data will drive including credit, savings, mortgages and insurance and
the next generation of innovation, creating huge value for investments; enabling citizens to have a complete picture of
society and the economy through interoperable, portable, their personal balance sheet in one place. The Centre for
quality data. Within a secure and trusted framework, and in Finance, Innovation and Technology (CFIT) has also called for
combination with Artificial Intelligence, tokenised assets and task force to develop a roadmap for Open Finance4.
smart contracts, this will drive a range of macroeconomic
objectives for UK PLC:

• Small business productivity gains, with more efficient 1. Build the world’s first
reconciliation, real time financing and streamlined smart data economy.
payments.
2. Make the UK the most
• Holistic financial management for consumers, improving secure place in the
financial literacy, democratising financial advice supporting world for consumers and
long term financial resilience of all citizens. businesses to use digital
finance.
• FinTech investment and growth, aligned to key government
priority areas. 3. Make the UK the world
leader in adopting new
• Promoting Financial inclusion through tailored financial technology in finance.
management and improved access to credit

• Opportunity for the UK to continue our global leadership in

real time payments and Open Banking innovation.

We already see other countries working towards a smart data

economy transition: Australia introduced the Consumer Data
Rights legislation as a step towards Open Finance; the
European Commission has proposed a new Open Finance
This paper aims to set out what is required to achieve an Open
framework; Brazil has extended Open Banking to all financial
Finance economy, and the path to get us there. There are
services; and Singapore has invested in the world’s first public
multiple initiatives underway across payments, smart data,
digital infrastructure, allowing secure data sharing between
and digital identity; and we have identified a number of
government agencies and financial institutions. The global
additional building blocks required to set the UK up for success.
trend towards Open Finance is clear, and it is crucial that the
UK takes the right steps now in order to set up for future The multi-faceted nature of Open Finance inevitably means
success. there are multiple paths forward to realise this vision. In this
paper we set forward three different paths to achieving an
The UK is globally recognised as a leader in this space – the first
Open Finance economy, focusing on the outcomes-based
country to introduce Open Banking and supporting a thriving
principles required to deliver tangible market action.
FinTech sector. In 2023, UK FinTech received more than $5bn of
investment3 – more than the next 28 countries in Europe
combined. However, a clear strategy and deliberate action is
required for the UK to continue along this journey and set up for
success as we navigate from Open Banking to a richer Open
Finance enabled economy. Open Finance spans more than just
Open Banking, or smart data – it is a holistic, dynamic, and

3 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

Current state of play – the Open Finance building blocks
already underway

There are multiple initiatives already underway across the market that provide a foundation for Open Finance. Ensuring
that these initiatives are fully realised, with the appropriate guardrails and design of future extensibility, is a critical
requirement for success.

01 Open Banking 02 The Data Protection & Digital Information Bill

The UK led the world into Open Banking and is recognised as a As part of the government’s commitment to an economy where
global leader. consumers’ own data works for them, and innovative
businesses thrive, the Data Protection and Digital Information
As of January 2024, there are now over 9 million active users of (DPDI) bill is currently being considered by Parliament8.
Open Banking in the UK with volumes and adoption growing
year on year amongst both consumers and businesses5. DPDI provisions consist of 3 pillars of data security and
Ecospend, a payment initiation services provider, reported that innovation.
in January 2024 alone £3.3bn of tax self-assessment payments
were made to HMRC via Open Banking6. Meanwhile the
availability of services continues to expand with services
focusing on payments, borrowing and financial decision The Data Protection & Digital Information Bill
making. Nonetheless, challenges remain around governance,
commercial incentives, consumer protection and consistency Data Protection
in technical implementation. To tackle these hurdles and
Updating and simplifying the current legislation to
promote the ongoing adoption of Open Banking, the Joint
Regulatory Oversight Committee (JROC) published a roadmap reduce compliance costs and improve flexibility
for the next phase of UK banking last year7. The industry is now Maintain high consumer data protection and
working through the 29 activities, on the five key themes - privacy standards
levelling up availability and performance, mitigating the risk of
financial crime, ensuring effective consumer protection,
Digital Identity
improving information flow to regulated Third Party Providers
(TPPs) and end users, promoting additional products and Introducing reliable advanced authentification and
services as well as finalising the design of the future entity. digital ID verification
Foundation for a cross-sector re-usable Digital
As implementation of these complex roadmap activities
Identity framework enabling secure and efficient
progress, a positive sign has been active engagement across
the industry towards a premium (Application Programming financial transations
Interface) API framework for broader data and variable
recurring payments use cases. A functional, scalable, and Smart Data
resilient Open Banking infrastructure is a critical foundation for
Unlocking benefits of Open Banking in other sectors
Open Finance, and this evolution must continue as a priority.
and enabling a cross-sector secure data sharing

The bill will provide the legal powers for ministers to

introduce smart data schemes in different industries,
enabling Open Finance to be introduced across industries
beyond Open Banking and the current Competition and
Markets Authority requirements (the ‘CMA Order’).
In addition, it will provide the legal basis for digital ID
schemes that could support Open Finance applications.
The bill is expected to be passed by summer 2024.

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 03 Smart Data Council 06 National Payments Vision

The Smart Data Council has been set up by the Department for In November 2023, the Future of Payments Review was
Business and Trade to advise on leading, developing, and published as part of the 2023 Autumn Statement11.
co-ordinating new and innovative schemes that utilise the Commissioned by HM Treasury and led by Joe Garner. The
power of Smart Data. The Council features representatives from Review provides several recommendations on the next steps
Citizen’s Advice, Innovate Finance, Open Banking Limited, CFIT for the UK to successfully deliver a world leading retail
and other stakeholders to drive forward open data standards payments ecosystem. The Review’s key finding was that the
and use cases. It is helping Government develop a roadmap for UK’s payments landscape is congested and would benefit from
smart data, and identifying the cross-cutting standards, a clear overall strategy. The government is committed to
infrastructure needed to support industry schemes and a maintaining the UK’s reputation for a world-leading payments
framework for interoperability and consistency across various ecosystem, and so has accepted the recommendation to
Smart Data initiatives. publish a National Payments Vision this year.

Open Banking will play a major role in the National Payments

04
Centre for Finance, Innovation and Technology Vision, building important foundations for the UK ecosystem to
(CFIT) grow into Open Finance. Enabling an environment for Open
Banking payments to thrive will foster competition, add rich
CFIT was established to unblock barriers to growth for financial functionality, and benefit the customer experience, particularly
technology and promote the UK’s financial innovation for peer-to-peer (P2P) and retail payments. The report calls for
leadership. The CFIT Open Finance coalition brings together the introduction of consumer purchase protections on Open
stakeholders from across the ecosystem to support the delivery Banking transactions and a sustainable commercial model
of Open Finance by developing solutions to main challenges that incentivises engagement, quality, and innovation across
and unlocking priority use cases. The coalition’s report on the market.
‘Embracing the UK’s Open Finance Opportunity’ outlines how
enhanced data-sharing can support democratisation of The Review also called for action around regulatory simplicity,
financial advice to consumers as well as SME credit access9. fraud mitigation, enhancements to digital customer
This sets out a number of ‘Proof of Concept’ models for Open experiences and streamlining the barriers to entry for FinTechs
Finance services, including SME credit and a Citizens Advice – all additional building blocks to support the trajectory of
financial diagnostic, which could now provide the basis for Open Finance in a flourishing UK payments ecosystem.
FinTech to build prototypes. These prototypes will show how the

07
industry can design new Open Finance products and services
Project Perseus
that make use of the available datasets.

Project Perseus is a project run by Bankers for Net Zero

05 ISO 20022 Messaging Standard Icebreaker One and supported by a powerful coalition of
banks, FinTechs, trade associations, accountancy bodies, and
ISO 20022 is an open international messaging standard that small business associations12. It aims to transform data sharing
facilitates exchange of enhanced data in a richer, more and sustainability practices for SMEs by taking smart meter
structured format. ISO 20022 has the potential to create a single energy data to create and automate rapidly scalable, low
common language for most payments globally, enabling effort, low cost, low friction sustainability and emissions
global interconnectedness of Open Banking payments and reporting. Successful implementation will enable banks and
financial services. With 70+ countries having already adopted lenders to assess the carbon emissions of their lending
ISO 20022, it harmonises the language for payments portfolio. Additionally, it will be possible to identify and track the
internationally10. As the Bank of England (BoE) is progressing with biggest opportunities for emissions savings amongst small
the implementation of the standard within CHAPS (the payment firms unlocking transition finance for the green economy.
system for high value payments) and RTGS (the Real Time Gross
Settlement that settles funds between banks and other
financial institutions), sending of enhanced data remains
optional, with certain elements gradually being mandated.

ISO 20022 provides the foundation to propel Open Finance

services and innovation, as many of the potential use cases
leverage flexibility of standards, functionality of enriched data
and straight-through processing.

Implementation of ISO 20022 enables Open Finance use cases

such as personalised offerings based on transaction analytics.
Its straight-through processing translates into fewer manual
interventions leading to lower probability of delays for the end
customer. This unlocks product innovation such as developing
a dashboard with a real-time view on customer’s financial
position. As the extent to which benefits are realised depends
on the industry using the data in a consistent manner, the BoE,
with the industry support, is compiling guidance for specific
use-cases of the standard to support coherent adoption.

5 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

 08 Pensions Dashboard 09 Digital Assets

The UK Pensions Dashboard will facilitate easier access to Digital assets leverage Distributed Ledger Technology (DLT) to
pension information for individuals across the United Kingdom. open up myriad opportunities for industry innovation, including
This programme, led by the Money and Pensions Service (MaPS) improving cross-border payments, streamlining trade finance,
seeks to aggregate pension data from various sources, enhancing anti-money laundering compliance, enabling
including private and state pension providers, into a single digital identity, tokenisation and creating new products and
digital platform accessible to individual users. The Dashboards services. While digital assets comprise a broad spectrum of
will provide users with secure, clear, and simple information use cases and applications, tokenised assets and Central Bank
about an individual’s multiple pension savings. By Digital Currencies (CBDCs) arguably represent the greatest
consolidating pension information, the programme aims to opportunity for Open Finance.
empower individuals by providing them with a comprehensive
view of their savings, enabling better financial planning and Blockchain technology, underpinning tokenised assets and
decision making. It is intended that most pension schemes and CBDCs, enhances flexibility, efficiency, security, and
providers will connect to the dashboard by October 2026, with a transparency of transactions. It has a potential to propel the
first cohort in April 202513. implementation of Open Finance by facilitating interoperability
between systems and enabling the secure exchange of
There is growing interest and debate surrounding the potential information and enable more Open Finance use cases. By
expansion of the Pensions Dashboard Programme to leveraging smart contracts, lenders and borrowers will be able
incorporate elements of Open Finance. The inclusion of the to operate via a decentralised platform, which can significantly
additional financial data within the Pension Dashboard could reduce costs. Another example is evident in home buying,
offer users a more holistic view of their finances and enable where smart contracts can automate the legal process
better money management across the different life-stages. lowering the legal fees.

10 Fraud and Economic Crime

The Economic Crime and Corporate Transparency Act 2023

(ECCTA) came into force in October 2023. It introduces
amendments to the corporate liability law and anti-money
laundering regulation14. Proposed provisions look to improve
the reliability and security of the Companies House, tackle the
misuse of limited partnerships, introduce a registry of overseas
entities, improve effectiveness of Unexplained Wealth Orders
(UWOs), and provide additional powers to seize criminal crypto
assets. This may enable better digital companies data from
Companies House, supporting Open Finance applications, and
support data sharing.

Other initiatives are also underway to develop data sharing

solutions to tackle fraud: in Open Banking, Transaction Risk
Indicators have been developed as part of the JROC
programme, to enable real time identification of potential
fraud. The Payment Systems Regulator (PSR) is also advancing
further work to develop data sharing to identify potentially
fraudulent APP (Authorised Push Payment) transactions.

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Additional Building Blocks

Alongside these inflight initiatives, there are several additional components required to enable an Open Finance ecosystem.
We have set out the additional areas of functionality or standards that will serve as the ‘building blocks’ required for
Open Finance.

01 Consumer Protections and Dispute Management This trust framework is developed, maintained and overseen by
Opening Banking Limited, a not-for-profit entity that sets the
standards, scheme rules, accreditation of participants, and
Consumer protection varies depending on the payment
performance monitoring.
method used. In the UK, the card schemes provide the most
advanced levels of consumer protection, with additional A universal trust framework that sets standards for
protection on credit cards purchases (Section 75 of the performance and reliability of the service and promotes
Consumer Credit Act) and well-defined dispute management interoperability is key to setting clear expectations and
mechanisms in the form of the chargeback service. If Open reducing friction for participants across the ecosystem. This
Banking is to compete in the retail payments market against trust framework would need to be underpinned by firms having
payment methods such as cards, it is crucial that adequate strong governance and compliance frameworks in place to
and appropriate purchase protections are put in place to build effectively manage risk, data, fraud, and the appropriate
customer trust and encourage further adoption of Open response plans in place to notify and respond to incidents
Banking services. should they occur.

More widely, a dispute mechanism is needed for Open Finance There are JROC activities underway to build upon existing data
applications and services - for consumers if something goes platforms that capture API performance and certification for
wrong; and for service providers and data holders if there is a broader data sharing use cases in fraud mitigation, financial
commercial dispute. crime and improving information flows to TPPs. This platform,
currently operated by Open Banking Limited, could be the

02
technology enabler for broader and commercial data sharing
Trust Frameworks for Data Sharing
requirements within Open Finance.

As we shift towards an open ecosystem, there needs to be

appropriate guardrails implemented to protect consumer trust. 03 Commercial Models
In an ever-changing digital world, the threat of cyber-attacks,
data breaches, fraud, scams and system failures pose Given Open Banking was introduced in the UK as a regulatory
increasingly more significant threats to the overall integrity of activity with open access to the suite of mandatory APIs, pricing
the open ecosystem. models and commercial incentive structures have not matured.
With the growth of premium Open Banking propositions beyond
Ensuring trust within an Open Finance economy is critical for
the CMA Order, and further expansion into Open Finance, the
adoption and success. A consumer’s willingness to consent to
requirement for a sustainable economic model that
sharing additional personal financial data will directly relate to
appropriately compensates different parties along the value
their understanding of the benefits of Open Finance solutions
chain, as well as incentivises engagement and innovation, is
and the confidence and trust of their service providers. As a
paramount.
result, it is crucial that firms invest in scalable, resilient services
that are capable of securely managing and protecting In future, government and regulators may (or may not) choose
consumer data. to mandate defined service providers to provide defined Open
Finance services. Mandated activities may be applied to all
market players where law makers and regulators consider this
Open Banking has implemented a trust framework
is necessary to ensure a ‘public good’ which cannot be
that can be a blueprint for Open Finance. Open
achieved by the open market alone, or they may be applied to
Banking is underpinned by 6 principles:
those seen as having significant market power (and / or
1. The customer never has to share their username and significant holders of relevant data) in order to open up new
password with any entity other than their bank. services or increase competition in existing services.
Commercial models can – and should – work where there is no
2. Open Banking is opt in, not opt out. such mandatory or public interest requirements.
3. It depends on explicit consent given by the customer.

4. It is as easy to revoke permission as to give it.

5. Only authorised entities can participate: only authorised

service providers can register on the Open Banking
Directory, so unauthorised firms cannot trick customers into
sharing their data with them.

6. If anything goes wrong there is a customer redress

mechanism.

7 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

Open Finance services and use cases need to be capable of
operating on a commercial basis whether or not some of the 05 Global Interoperability
framework is prescribed by regulators or law makers. Unless
there is a wider public policy case (as did exist in terms of
In looking at international standards for compatibility, there are
competition in the current account bank market), data holders
two aspects that will be important for the future success of
(often market incumbents) should be able to (at a minimum)
Open Finance in the UK:
recover their costs for providing data to a third party, and be
suitably incentivised to engage, participate and innovate within
• For cross border services, ensuring that regimes for cross
the Open Finance ecosystem. Equally, third party providers
border transactions provide equivalent protections.
should be able to access data on behalf of a citizen at a fair
and reasonable price that reflects the data holder costs and
• For products being offered for domestic services in more
does not act as a barrier by making the business model loss
than one country, for example enabling UK FinTechs to
making.
export their products and services to other jurisdictions.
There will be numerous other factors affecting commercial
viability. One such factor is scale – where at the outset services For cross border services, there is a wider set of standards or
may be uneconomical due to low volumes, yet become cost scheme rules that need to be recognised to provide trust and
effective and commercially viable once a scale and volume is confidence of consumers, commercial participants and
reached. government and regulators. Data protection regimes (and
equivalence of these) will also be an important building block.
In short there is no ‘silver bullet’ to introduce sustainable
commercial models. Each use case and market will need to be ISO 20022 provides the initial technical standards for relevant
appraised of the commercial or regulatory model that best fits API interoperability. However, this may require development of
the potential benefits, costs incurred, and wider market bilateral or multilateral international agreements covering
considerations - and these will need to be reviewed over time. aspects such as trust frameworks specifically for data use,
For example, to potentially change the commercial or commercial disputes resolution, consumer redress, fraud
regulatory balance as a market scales (reducing costs) or protections as well as balancing the respective requirements of
develops (either as a competitive market or as a monopoly or domestic sovereignty and resilience requirements with
oligopoly develops). international interoperability.

There can however be some common principles established to

avoid reinventing the wheel. This may include assessing
whether a commercial model has been tried; considerations of
06 Governance Oversight

cost allocation and fair pricing (including what costs are

included in the cost of providing access to date by the data Within financial services we already have a number of industry
holder), and the extent to which any commercial model bodies that in some way provide ‘governance’ or cross-industry
empowers the individual consumer or data owner. Leveraging agreement of specific markets, in some cases intertwined with
the JROC principles for funding models may also be a regulatory requirements. Open Banking Limited is one such
constructive starting point to be extrapolated to broader Open example. For the pensions dashboard, the Money and Pensions
Finance initiatives: fair, proportionate, clear and transparent; Service has established a Pension Dashboard Programme.
simple to access; will not lead to bad behaviours; simple to Outside of Open Finance, SCOR (Steering Committee on
administer; avoids barriers to entry; recognises different Reciprocity) brings together the Credit Rating Agencies and
business models. some other market participants to agree rules on the sharing of
credit data – something that is being reviewed by an
independent working group set up by the Financial Conduct
04 Digital ID Authority (FCA). As we expand from Open Banking to Open
Finance, an independent governance body or bodies will be
needed to set the strategic direction, enforce standards and
A digital ID framework could serve as the cornerstone for secure trust frameworks, manage certification and access, oversee
and efficient financial transactions in an open data ecosystem commercial disputes and potentially manage operational
in the UK. Reusable digital verification can enable consumers to activities, such as service directories and system security.
access smart data and Open Finance services easily and
securely, it can help tackle fraud, and it opens up opportunities The JROC industry working group on the Future Entity for Open
to tackle financial exclusion (often caused by people not having Banking has carefully considered the question of governance
a variety of paper based documentation). This lays the of future Open Banking entity. This provides a good working
foundation for implementing advanced authentication and model for future governance of sector schemes within financial
digital ID verification methods while ensuring compliance with services and has been designed with expansion to other Open
the latest regulatory standards which will in turn, increase trust Finance areas in mind.
and confidence in digital UK financial services. A digital ID could
provide a trusted mechanism that will allow mass adoption of There may be a case for a single high level overarching
Open Finance solutions across the ecosystem. However as the governance model providing a framework for all Open Finance
UK shift towards this operating model, there needs to be strong schemes. This is possibly not something that can be built at the
collaboration amongst market participants to promote trust outset but may – or may not – evolve over time. At the
and manage risk across the value chain. minimum, consistency and collaboration between entities will
be critical, not least in ensuring that different data sets can be
combined in single services; and whilst more than one entity
may be needed, avoiding a profusion of multiple entities will be
desirable.

8 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

A Path to Open
Finance in the UK
Open Finance is a multi-faceted, cross- Regardless of the path, underpinning For governments to assess the best
industry concept, and consequently the successful realisation of Open model for the UK market, a matrix of
there are multiple different scenarios to Finance, we have identified three prioritisation criteria should be
achieve this vision for the UK. There are prerequisite criteria that must applied:
various implementation factors to underpin development:
consider, from governance models, • Ease of implementation: Too often,
commercial incentives, priority use • Trust Frameworks and Standards: the industry has sought to tackle
cases, whether the impetus for Increasingly, trust is the currency large-scale transformation
innovation is regulatory or market driven, we trade in within payments and programmes, and got stuck in the
and, most importantly, the desired Open Finance. Ensuring trust – from quagmire of requirements definition,
outcomes for customers and the market. end-users, between market collaborative decision making and
participants and by regulators, is descoping scenarios. Setting
critical for adoption. Consistency of manageable, practical, and feasible
standards, and associated goals that do not overburden
interoperability will support change resources and investment
innovation, drive efficiency, and capacity of industry stakeholders
keep barriers to entry for new will be important criterion for
FinTechs and innovators low. success.

• Performance and Reliability: As • Incentives & Participation Drivers:

with any critical infrastructure, Understanding the incentive levers
availability and resilience criteria that apply to different parties across
are must-have table stakes for the Open Finance value chain will be
success. Open Banking Limited has key to encouraging participation,
led the world in terms of Open API engagement, and innovation. These
performance metrics to date, could manifest from commercial,
however much more work is customer, efficiency, or regulatory
needed to deliver consistent drivers, with recognition that a
performance standards that will combination of these incentives will
enable mass adoption and likely be required to enable a
payments services. Credibility and flourishing market. Economic
trust can be quickly undermined by sustainability will be prerequisite for
poor performance or resilience the long-term success of Open
issues, with potential to cause Finance.
significant and immediate
detriment to large sections of the • Outcomes & Macroeconomic
population if they are unable to Impact: We know that an outcomes-
make payments or engage with led approach is critical for the
their finances. successful introduction of any new
solution or market proposition. As
• Governance and Oversight: Having governments, regulators and market
an accountable body to oversee leaders consider the prioritisation of
the industry, mediate disputes and different use cases and sectors for
drive innovation forward will be Open Finance, keeping the end-user
critical. To some extent several outcomes or macro-economic
different bodies will be needed - objectives at the front of mind will be
We propose that there is a role for critical. There are some use cases
government to set outcomes and that will drive greater socio-
objectives, for regulators to set the economic outcomes than
framework around that and commercial outcomes – and vice
industry to innovate within. Building versa. Promotion of financial
out existing forums and leveraging inclusion or ESG outcomes is equally
areas for efficiency, shared important but must be led by
services, and single ownership of outcome realisation analysis.
‘horizontal’ issues such as trust
frameworks or digital ID is advised,
alongside a single government
minister to oversee the UK’s Open
Finance strategy.

9 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

Three Scenarios to Achieve a Roadmap to
Open Finance in the UK
In this paper, we have set out three potential scenarios to implement Open Finance in the UK, outlining advantages, disadvantages,
and implications of each. We recognise that there are different benefits to different parties across the value chain from each of the
three scenarios, and each scenario will result in different use cases and macroeconomic outcomes. They are also not mutually
exclusive or exhaustive of all scenario options. Nonetheless, the hypotheses below aim to provide the platform for discussion and
debate for legislators, innovators, and all industry stakeholders to progress a pathway forward.

Three potential scenarios to deliver an Open Finance economy

Universal Mandate Individual & Incremental Strategic Plan

Introduction of a broad, data sharing Independent initiatives to extend Open A cross-sector vision and roadmap for
mandate across all sectors, whereby Banking capabilities into new use Open Finance use cases, maximising
innovative market players can develop cases or sectors, where the lower interoperability and enabling
data-led commercial propositions hanging fruit use cases will be prioritisation of the most complex, but
addressed first – either by regulators high impact use cases
Government role introducing mandate or market drivers
for universal data request rights, Central, pan-government future entity
followed by market-led innovation Individual sector or use case initiatives, owning prioritised roadmap, and
driven by market initiatives or sector ensuring common standards and
Commercial drivers as incentive regulators implementation
for innovation
Rapid development of low hanging Higher social & macro-economic
No standardised approach to API use cases, driven by ease of impact use cases
standards or performance – long implementation or largest
adoption tail and potential role for commercial gain Regulatory clarity
market standards (e.g. FDX)
Siloed development of use cases Long implementation timelines,
High operational complexity and - No interoperability or alignment, high investment requirements &
cost of access for TPPs potential duplication bureaucratic complexity for
cross-sector use cases

Winning Use Cases Winning Use Cases Winning Use Cases

Far reaching consumer super-apps Savings, wealth and insurance as Embedded credit decisioning within
that incorporate financial adjacent use case to Open Banking, carbon emissions tracking, enabling
management, lifestyle & payments use with existing API infrastructure financing for net-zero positive
cases behaviours

Option for sequential, phased implementation approach

10 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

Scenario 1: Universal Mandate
The first scenario is the introduction of a broad, data sharing mandate simultaneously across all sectors, from which innovative
market players can develop data-led commercial propositions. Whilst not as broad as the universal data right we have proposed
here, the Consumer Data Right Legislation in Australia is a comparative example of this approach, enabling data sharing across
banking, telecommunications, and utility providers.

Phase 1: Introduction

Government introduction of data sharing mandate, enabling data request rights to all
licensed parties, across sectors

Mitigates the data asymmetry imbalance that exists today where some parties, with
significant customer data repositories beyond banking, can also access Open Banking
data without reciprocity

One size fits all approach does not accommodate for the nuances and complexity of
different sectors

Phase 2: Implementation

Market-led innovation, with use case development driven by user needs. Commercial
negotiation around premium APIs and customer propositions would be bilateral, between
data holder and data recipient

Market driven innovation, with commercial outcomes as the primary driver for use case
development – this means innovators must be outcomes led, and will only develop
propositions that satisfy the unmet needs of consumers

Consumers will see the advantage of highly innovative and competitive product
offerings, central to where the greatest demand and willingness to buy lies

Fintechs and innovators can prioritise the most commercially viable use cases, and can
participate more broadly across various sectors that did not previously enable data
access

Potential for immediate uptake of commercial use cases, with a long tail of widespread
adoption

Alternatively, without regulatory mandate or government incentivisation, there is no

guarantee of adoption

No standardised approach would lead to disparity in API standards or performance

Potentially higher cost of data access, in the absence of a regulated standard

TPPs would have technological complexity to meet different standards and have a high
commercial burden of commercial negotiation on a bilateral basis

Potential financial exclusion risks, as priority use cases are exclusively commercially
driven

Phase 3: Run

Even under a market-driven scenario, there is a requirement for central arbitration, likely
provided by government

Potential role for market driven standardisation, akin to the FDX model in the United
States

The existing challenges we see with Open Banking today around funding, governance
and remit of central oversight bodies would still apply

High operational complexity and cost of access for TPPs could lead to higher barriers to
entry and consolidation in the sector

11 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

In this scenario, we hypothesise the winning use case is a various contracts that would need to be negotiated with each
far-reaching ‘super app’ where consumers have access to all of different counterparty, may present an access to data cost that
their data in one centralised place, enabling simple is unfeasible high.
management of the lifestyle they lead. The initial investment
required for such a proposition is high, and thus likely suited to Finally, whilst consumers ultimately win as a result of Open
parties who already deploy customer propositions across Finance, with this scenario there will likely only be access to,
financial and lifestyle sectors, as well as offering embedded and investment into, those that are commercially viable for the
payments. TPPs. This leaves a gap in the market for social benefit solutions,
such as ESG use cases, which could have a wider positive
Given the market-led approach of this scenario, consumers will impact on the UK.
also see the advantage of highly innovative and competitive
product offerings, central to where the greatest demand and
willingness to buy lies.

There is clear opportunity for BigTech players in this scenario,

working towards a ‘super app’. In addition, larger FinTechs will
likely have a greater opportunity to enter new sectors they did
not previously play in. However, there will also be opportunity for
the smaller players in the market to follow niche, commercially Spotlight on: FDX
feasible opportunities and carve out market share.
The Financial Data Exchange (FDX) in the US and Canada,
There also lies the risk, that in this market-led approach, there
is a non-profit industry body, established to support the
won’t be action. We have seen the limitation of voluntary
migration towards a financial data sharing economy.
engagement by incumbent banks within the UK’s Open Banking
FDX works to provide a common interoperable standard
mandate and acknowledge how a greater regulatory presence
for TPPs to work off the FDX API. This approach has allowed
may be required to steer progress in this space.
TPPs to use the rails of an API with significant uptake,
The contractual, operational and technology complexity of allowing market-led product offerings to be pursued
managing various use cases across different commercial quickly at a relatively low cost, resulting in commercially
relationships with third parties would also be high. Whilst a viable offerings, and an innovative economy. Whilst the
large opportunity lies for smaller TPPs to come to market, the FDX is not market-mandated and so not utilised across
the US/Canadian market fully, a high proportion of
members from across the ecosystem have coalesced
around this standard, from large financial institutions to
small FinTechs; giving a smaller-scale glimpse into the
outcomes of an Open Finance economy.

12 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

Scenario 2: Individual & Incremental
The second scenario would see individual sector or use case initiatives being mobilised, driven either by regulators or market
initiatives. Ease of implementation and synergies with existing use cases will see rapid adoption of many low hanging fruit use cases
in Open Finance. This is most akin to the current state of the UK ecosystem, where deeper focus on Open Banking use cases has
been the priority and where the Pensions Dashboard is being developed as a separate initiative.

Phase 1: Introduction Phase 2: Implementation Phase 3: Run & Grow

Regulatory, government or market Independent initiatives to extend Disparate operational governance

introduction of specific sector or Open Banking capabilities into for different initiatives, with limited
use case led Open Finance new use cases or sectors interoperability between
applications

The Pensions Regulator Pensions Dahsboard Programme Money and Pensions Service

FCA Commercial Open Banking Commercial Open Banking

Industry Forums Project Perseus Individual scheme

Illustrative examples only

CFIT Individual schemes

Introduction of outcomes- Rapid development of ‘low More feasible roadmap for

based use cases, with hanging’ use cases, driven by incremental implementation,
prioritisation of initiatives that ease of implementation or with lower investment
are most pertinent for largest commercial gain requirements
individual sectors and
regulators Allows specialised innovators to Encourages collaboration and
develop targeted propositions alignment between regulators
Regulatory clarity on use case
direction, enabling Fintechs / Market-led use cases will drive Potential for multiple,
TPPs to commit to funding, quicker alignment of incentives overlapping and even
development and growth plans across value chain contradictory governance
arrangements for different
No overarching national Siloed development of use Open Finance schemes if each
strategy for Open Finance cases - No interoperability or has its own
alignment, potential duplication
Potential for different regulatory Inconsistent standards due to
bodies introducing conflicting Innovation could remain innovation with siloes, causing
initiatives or objectives isolated within sectors and use concerns for long term
cases will be prioritised on the interoperability
ease of implementation as
opposed to focussing on the Additional complexities and
more material, complex use bilateral agreements when
cases that require cross-sector contracting for services cross
collaboration sectors

Potential risks around

inconsistency of competition,
resilience and performance for
different initiatives

13 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

Use cases that can leverage existing open infrastructure will be
the clear winners here. Propositions that are adjacent to
existing Open Banking frameworks, such as savings, account
switching and investment15, and can leverage the contractual
basis and technological build of commercial Variable Recurring
Payments (VRPs) will be quickly identified as low hanging fruit.
Likewise, sectors that already have API-based infrastructure –
such as energy smart meters – will be able to evolve
propositions more quickly into embedded finance. Alternatively,
use cases such as green lending or financial inclusion would
continue to face friction in delivering and co-ordinating
cross-sector activities. Broader financial services capabilities,
such as insurance and mortgages, would likely be longer term
implementations – the risk and regulatory profile, complex
operational structure and nuanced requirements of these
sectors would inevitably see these as longer-term
developments.

The biggest challenge under this scenario is interoperability

and extensibility. With the continued development of individual
initiatives, there will be vast amounts of varied data sources
across multiple sectors. In the absence of a co-ordinated
governance oversight and roadmap prioritisation mechanism,
either led through regulation or by an empowered, accountable
body, there would be a high level of complexity. This would
result in different regulators being responsible for managing
their respective sectors - close monitoring and communication
would be essential to ensure that interoperability, market
competition and resilience of the market are monitored as the
Open Finance ecosystem incrementally develops.

Spotlight on: Regulatory Alignment

• The UK Regulators Network (UKRN) brings together a broad range

of UK regulators, for the benefit of consumers and the economy.
Established by members in 2014, UKRN have developed strong
relationships and a culture of collaboration and learning. UKRN
work together to share knowledge and innovation, explore
cross-cutting issues, and build better ways of working.

• The PSR and FCA would play key roles in ensuring the priorities,
standards and approaches are set to foster innovation and
competition in the markets.

• The CMA would need to ensure that competition is closely

monitored as the Open Finance ecosystem develops.

• The Prudential Regulation Authority (PRA) would need to closely

monitor how the Open Finance ecosystem develops, with a
watchful eye on systemic resilience and third-party
management.

14 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

Scenario 3: Strategic Plan
The full potential of Open Finance lies in the cross-sector use prioritisation conducted centrally. The central institution would
cases leveraging financial and non-financial data. Cross- be responsible for laying out a roadmap for Open Finance use
sector use cases require collaborative pan-government cases. While they would hold the ultimate accountability for the
leadership setting out a long-term vision, a north star to drive a effective implementation, the key to the success would lie in the
sustainable impact on the economy and society. This scenario collaboration and input from key stakeholder groups starting
maximises the interoperability and collaboration between from the vision co-creation. To mobilise action and
sectors and enables the prioritisation of the most complex collaboration the vision and roadmap would take into account
cross-sector use cases. Whilst more arduous, implementation all market participants. This could mean convening cross-
of propositions bringing together several industries would drive sector working groups.
more material impact on all stakeholders and the wider society
than the other approaches. Should new regulation be required, the central institution would
mobilise relevant parties, enforce the legislation and address
The governance and leadership of the strategic cross-sector violations. This could include imposing penalties on non-
vision would sit with a central pan-governmental body set up of compliant firms and escalate disputes to appropriate
which would leverage lessons drawn from Open Banking. This institutions. The central entity would be responsible for
institution would comprise of diverse set of voices representing consistent implementation of common standards. They would
an array of stakeholder groups, including consumers, SMEs, define and manage an incentive framework. To enhance
trade bodies, FinTech, BigTech and regulators. The diversity efficiency, tactical activities could be delegated to sectors,
would support inclusion alleviating the asymmetry of power schemes or specific market players. Interoperability would
and lowering the probability of frictions among market promote continued innovation within and across sectors,
participants. There would be a single, regulatory strategy with results of which could be fed into the roadmap.

Phase 1: Introduction Phase 2: Implementation Phase 3: Run & Grow

A central, pan-governmental future A clear roadmap of prioritised (and Future pan-governmental oversight
entity develops the cross-sector interoperable) use cases, aligned with the entity responsible for ensuring
vision and roadmap for Open strategic vision consistent standards, access and
Finance use cases certification, disputes and working
Higher social & macro-economic impact
with the market to ideate new
A single, regulatory strategy use cases
roadmap innovation
provides clarity, with clear
Interoperability would promote continued
roadmap of future use cases Central Entity would comprise of
innovation within and across sectors
and release schedule for new diverse set of voices
requirements and standards. Effective articulation of the vision would representing an array of
This enables all parties to better support a dissemination of a clear stakeholder groups
plan longer term investment message to the public, in turn aiding
Pan-sector governance can
funding, technology build, public understanding and accelerating
ensure fair and equitable
resource allocation and product adoption
arrangements for all market
development. This would drive
Higher investment required to develop participants and alignment of
operational efficiency, overhead
complex use cases, disadvantaging interest across the ecosystem
cost reduction and business
smaller FinTechs or new entrants
productivity Clear and proportionate
Some quick wins may not be realised early regulation enforced consistently
Long implementation timelines
on if they are not prioritised in the across sectors and all market
to establish the entity, set up
roadmap, which may impact short term players could mitigate the risk of
governance, regulatory
economic gains in more advanced sectors data asymmetry
foundations, establish vision
and devise a roadmap Potential Competition Law challenges Productivity and efficiency
around collaboration benefits of collaboration
Bureaucratic complexity to
mobilise strategy and operating Practical implementation challenges in Long lead times to facilitate
entity for cross-sector use cases terms of feasibility and complexity of collaborative agreement across
scope, capacity and timelines – eg ‘action all relevant stakeholders in a
paralysis’ cross-sector initiative

Future innovation may be hampered if the

roadmap reviews do not account for
possible market changes and new use
case development that would call for
iterations

15 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

Under this scenario, we see complex, cross-sector and high efficiency of credit decisions reduces credit, operational,
social impact use cases having the most value. We hypothesise regulatory, and reputational risks of lenders. On a market level it
a winning use case being embedded credit decisioning within stabilises financial markets and improves resilience of the
carbon emissions tracking, enabling financing for net-zero financial system. From the borrower’s perspective, the ability to
positive behaviours. As an example, access to real-time and obtain the right loan in a timely manner improves financial
accurate transaction and investment data enables inclusion leading to cost efficiencies and enhanced
development of a comprehensive financial dashboard. A productivity. Additionally, access to capital fosters competition,
holistic view of a financial situation would give customers innovation, and entrepreneurship. Providing reliable information
greater control of their budget, and can drive personalised on one’s carbon footprint would help market participants in
insights or nudges enhancing financial literacy and overall reaching Net Zero goals. At the same time, lenders would be
financial health. able to draw an accurate picture of a borrower’s credit
worthiness and reliably evaluate climate change related risks of
Combining financial data with accurate and standardised their loan portfolios impacting their risk management practices.
business activity reporting would enable more reliable tracking This could transform the availability of finance for Net Zero
of carbon impact. Project Perseus would propel this use case by transition investment - in both businesses and in homes.
unlocking SME energy data sharing. Improving accuracy and

Conclusion
In assessing the three scenarios, it is clear there are multiple In practice we can expect the UK to adopt an approach that
permutations of a roadmap, each with respective advantages combines different elements of the scenarios we set out in this
and disadvantages. Yet the question remains - what is the best paper. What we now need is discussion and agreement on the
roadmap to enable widespread adoption and scaling of Open direction of travel and key principles for Open Finance in the UK;
Finance? Considering the benefits of deep, industry specific together with a prioritisation and phasing of use cases and
initiatives against the realisation of broad-based mandates will data sets.
be key.
The momentum behind Open Finance in the UK is clear. While
Ultimately, when considering the respective advantages of the various initiatives and building blocks already underway will
different roadmap scenarios and the prioritisation matrix (Ease continue to iteratively evolve, we encourage legislators,
of Implementation, Incentives and Participation Drivers, innovators, and industry participants to come together and
Outcomes and Macroeconomic Impact) the potential for a engage to progress a pathway forward. Undoubtedly, Open
sequential, phased approach across the three scenarios is Finance represents a huge area of opportunity for the UK, and
foreseeable. Tackling low-hanging fruit use cases under an we look forward to working with stakeholders across the
incremental model, in parallel with activity to design a strategic industry to engage, prepare, innovate, and grow.
roadmap and enable interoperability across use cases, seems
a pragmatic approach to drive momentum towards Open
Finance. Open Finance will create new business models that will
connect different verticals, and a phased approach will enable
the growth of both deep and broad innovators. In some
circumstances, innovation will be specialist and personalised,
inspiring propositions tailored to specific sectors, such as
mortgage brokerage. On the other hand, we’ll also see the
emergence of FinTechs providing more generic data sharing or
ID verification services broadly across all industries.
Irrespective of the model chosen, the development should be
underpinned by key principles of a Trust Framework &
Standards, Performance & Reliability, as well as Governance &
Oversight.

16 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

Contacts
KPMG

Ellie Hewitt Peter Harmston Connor Clark

Director, Open Finance Lead, Partner, Head of Payments Manager, Payments
Payments Consulting Consulting Consulting
[email protected] [email protected] [email protected]

KPMG LLP, a UK limited liability partnership, operates from 20 offices across the UK with approximately 18,000 partners and staff. The
UK firm recorded a revenue of £2.96 billion in the year ended 30 September 2023.

KPMG is a global organisation of independent professional services firms providing Audit, Legal, Tax and Advisory services. It
operates in 143 countries and territories with more than 273,000 partners and employees working in member firms around the world.
Each KPMG firm is a legally distinct and separate entity and describes itself as such. KPMG International Limited is a private English
company limited by guarantee. KPMG International Limited and its related entities do not provide services to clients.

Innovate Finance

Janine Hirt Adam Jackson Rashee Pandey

CEO, Innovate Finance Director of Policy Associate Director, Membership and Growth
[email protected] [email protected] [email protected]

Innovate Finance is the independent industry body that represents and advances the global FinTech community in the UK. Its
mission is to accelerate the UK’s leading role in the financial services sector by directly supporting the next generation of
technology-led innovators.

17 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance

 Footnotes
1. Data Protection and Digital Information Bill

2. CFIT: Embracing the UK‘s Open Finance Opportunity

3. FinTech Investment Landscape 2023

4. CFIT Open Finance Blueprint

5. Open Banking: ‘Smart Data: Unleashing the full

potential of Open Banking’ – event round-up.

6. Ecospend reports rise in value of tax payments made

to HMRC via Pay by Bank

7. JROC: Update on actions to enable the next phase of

Open Banking in the UK

8. Data Protection and Digital Information Bill

9. CFIT: Embracing the UK’s Open Finance Opportunity.

10. Bank of England: CHAPS transitions to latest global

financial messaging standard.

11. Joe Garner: Future of Payments Review

12. Icebreaker One: Perseus: automating SME emissions

reporting

13. Paul Maynard: Pensions Dashboard Update

14. GOV.UK: Economic Crime and Corporate

Transparency Bill overarching

15. TISA: Open Savings, Investments and Pensions (OSIP)

18 The Roadmap to Open Finance in the UK - KPMG & Innovate Finance