Challenge and an Opportunity
Following the implementation of the PSD2 (Revised Payment Service Directive) the current monopoly on a customer’s account information and payment services has disappeared for banks. For the banking sector, PSD2 poses substantial economic challenges, which are set to see an increase in IT costs on the back of new security requirements and the opening of APIs (application program interface).
The PSD2 enables bank customers, both consumers and businesses, to use third-party providers to manage their finances. This change in policy brings with it opportunities for new and existing technology businesses to offer consumers a different way to bank. It will allow customers access to a competitive market that offers tailored financial products. Recent reports have shown the substantial growth in fintechs (financial technology companies) exceeded $100 billion in 2019, which reinforces the opportunity that policy changes like the PSD2 will undoubtedly present.
The Rules are Changing
The increased availability of account information will significantly drive up the amount of data required to be shared, computed and stored.
At a time when data availability and security is critical for business growth, this policy change presents some additional challenges for the market to navigate. Recent availability issues and data breaches have demonstrated the real-life impacts to personal disruption, safety and financial penalty. Financial regulations aside, the ability to provide a common standard for national and international recognition will be key for these services to work and will need to be adopted continuously. Invariably, the policy change will also result in a greater use of AI, blockchain and biometric data to deliver the new services.
Keysource has been working closely with TechUK to stay ahead of the technology curve in order to recognise changes in the sector which will impact the industry. The Keysource ‘2019 State of the industry report’ revealed that for the data centre industry, common standardshave been a challenge in the sector. The report explored the ‘standards landscape’ which has been identified as confusingand recognised by the industry as a key area of improvement within the next 2 years. Specialists like Keysource, with the tools to rapidly evolve and address areas such as common standards, will continue to influence the sector, as the need for support and growth within new markets and technologies is set to increase in 2020.