Its the presentation I made for the management committee on Open Banking

1. Suryoday Small Finance Bank
Open Banking
September 2018
www.suryodaybank.com
Farhan Ali
Digital Banking

2. Content
2
Drivers of
Open Banking
3
Regulations
and Timeline
4
API and
approach of
banks
5
What's in it
for
Suryoday
1
What is
Open
Banking?
2

3. 39 @CAWORLD #CAWORLD
300 years
1690
Banks
functioned
on pen and
papers
2017
OPEN
Banking
7 years
2020
Block
Chain
BANKINGE V O L U T I O N
over the years 1 year2
2010
Mobile
Banking
20 years
1990
Internet
Banking

4. BECOMING AN
OPEN BANK
Being an open bank means operating like a platform company, with a business model that connects
people and processes with assets and a technology infrastructure to manage internal and external
users interactions
TODAY TOMORROW
CUSTOMERS CUSTOMERS
TRADITIONAL BANK OPEN BANK
CHANNELS CHANNELS APIs
PLATFORM
3rd PARTY A
DEVICE
DEVELOP
PRODUCT LINES PRODUCT LINES
CORE SYSTEMS CORE SYSTEMS

5. What is open banking?
An open ecosystem offers a new network of tech-enabled functionalities
Closed Ecosystem Open Ecosystem
 Limited access to data & sharing
Customers
 Data access & sharing bi-directional
 Business models are distributed
 Banks serve as platforms
Customers
Utilitie
s
Financial institution
Payment
providers
GovernmentFinancial institution

6. Emerging forces shaping the future of banking
1 Regulation
1 Enabling Technology
1 Competition
1Consumer demand

7. USA
Legislatorshave hinted
that open banking
regulations may be
introduced in the US
UK
Open Banking Rules require
banks to make a wide range of
data available
EU
PSD2 requires every
financial firm to create
communication interfaces
Asia Pacific,Singapore,
Malaysia and Australia
All consider mandating
banks to provide access
to data
Regulatory trend around the world

8. EEA* +
Switzerland
What?
SEPA PSD1 PSD2
Objective
Key players
When
To provide a legal framework
for
payment services**.
It improves rules for
electronic payments, taking
into account emerging and
innovative payment services.
Payment institutions:
Non-bank institutions that
provide payment
services.
Third party providers (TPP):
Those who can access
account information or
initiate payment transaction.
EEA + Switzerland
PSD2 is one of the initiatives intended to create an efficient and integrated market for payment services in the EEA.
To create an efficient and
integrated market for cross-
border payment services.
Payments are processed under
the same conditions.
Banks
Effective by 2009 Effective by 1 Nov
2009
Where EE
A
Effective by 13 January
2018*EEA = 28 EU members, Iceland, Liechtenstein,Norway
**Payment services = Service relating to payment account (current account, e-money, credit card account, current account mortgage); card issuing; merchant acquiring;
remittances; mobile- based payment services.
*SEPA = Single EURO Payment Area

9. Private APIs
Allow internal systems to
communicate Example: Bank‘s
mobile app connects to bank‘s
core system
Open APIs
Enables third party developer
access Examples: Paypal has
APIs allowing third parties to
built their own apps
Mobile-core
connection
Uber app (Google
Maps)
Enabling Technologies
There are two main types of APIs

10. Digital & social
experiences are redefining
the use of technology in
banking
Due to the interconnected
web, customers favor
mobile interactions
Need for intelligent,
contextual services in daily
interactions with providers
New expectations Better mobile
connectivity
Contextual
service
Consumer demand

11.  Banks build strategy to get the
most from open banking
 Maintain and extend a dominant
position
 Afraid to loose customer
relation and damage the
bank‘s position
 Late followers might miss the train
Proactiv
e
Reactive
Bank’s approach on open banking fall into two
camps

12. Open banking –What the future holds!!
Open Banking impacts you! – Many banks successfully started initiatives
already
Banks can take various approaches to implement open banking, among other the
app store model, the sandbox model, and acting as an enabler for smaller banks
Banks actively driving open banking initiatives will be better positioned
to maintain and extend their dominance
Focus on customer needs, individualize products and services, improve user
experience and anticipate customer needs.While doing so, always stay visible!

13.  SSFB can provide GST
compliant invoices to
Its MSME customers
 Bulk payments could
be easily transacted
 Payment request
could be automated
and recurring
payments could
easily be completed
without hassle
What’s in it for Suryoday

14. Can Suryoday be an Open Bank ?
 SSFB can easily become an
Open bank as there is no or
negligible legacy system
 As our entire system works
on API, migration would be
easy
 More than a bank we can
become a platform for cross
channel transaction
 A platform to invest in
mutual funds and stocks

15. ThankYou!!