Open Finance has significant potential to support small businesses

IN BREIF:

- Open Finance can help small business tackle five of their biggest challenges: cashflow, finance, late payments, winning new customers, and financial business administration

- The report analyses the potential future impact of smart data via the development of Open Finance, a term which is widely accepted as referring to the expansion beyond Open Banking into a wider range of financial products and services

- The research conducted for the report included interviews with 35 industry experts and small businesses, and concludes that Open Finance could deliver considerably enhanced benefits to small businesses than they currently experience from Open Banking

What does this mean?

Julian Wells, Director and Financial Services & FinTech Lead at Whitecap Consulting, said: “Open Finance has been a hotly debated topic in the financial services sector for some time now, with considerable focus placed on the potential implications for banks, financial services providers, FinTech firms, and policy makers. A group that has not been prominently represented in these debates is small businesses, but 99.2% of the UK’s companies are small businesses with fewer than 50 employees, employing 12.9 million people. Small businesses have undoubtedly benefited from Open Banking and other data related technology developments, but we have found that Open Finance represents a bigger and broader opportunity to benefit these firms.”