Banks and PSD2: "Field day for aggregators" or opportunity for banks to become center of gravity?

[bkirschner]

The Economist described PSD2 as "a potential “field day” for account-data aggregators aiming to suck account information from multiple banks into an app." I've stated my piece: that banks should seize it as an opportunity to build a richer, deeper relationship with their customers as aggregators themselves.

Who do you (whether in banking or not) see in winning and losing as a result of PSD2? Bankers...is the glass half full, half empty, or half full of something you don't particularly want to drink?

(Apigee's @Ed Anuff will be at our Open Banking Summit later this month - let's get the conversation started here...)

[#2]

This is possibly one of the many "Known Unknowns" which PSD2 has thrown up. To muddle up matters further, there is a possibility that leading digital super powers/tech giants like the GAFA may seize this as an opportunity to enter banking territory. Will banks have enough brand muscle to ward of these digital super powers ? Only time will tell !!!

[mleppitsch]

Let me phrase this comment in the negative:

Executive teams often hammer their nascent API programs for a unicorn-like business case before increasing commitment of resources, stifling the baby in the crib. PSD2 offers yet another trap to prevent successful participation in the digital economy.

The trap looks like this: relegate PSD2 to the compliance officer and treat it as regulatory risk.

What a huge mistake.

It's not every day that regulatory change presents an opportunity to change the game on your competitors. Past disruptions, like energy deregulation and others, have shown some winning patterns for enterprises: First and foremost is to assign the work to a hand-picked business development A-Team, and fund it well enough for those teams to experiment with models and pilots to create, quantify and update weekly a formal decision tree.

At the height of electric power deregulation, I had the opportunity to see this pattern in action at several energy companies. The most dynamic ones held weekly executive scrums with their A-Teams where the week's learning and decision tree were reviewed, and the next week's course of action was plotted. Actions included testing new trading patterns, framing up new energy products, engaging with new potential customer classes. The focus was singularly on finding courses of action that would create competitive advantage, while also modeling downsides and hedging strategies.

For the most part, this approach resulted in entirely new lines of business for such enterprises, while those that focused on staying the status quo ended up arguing over shrinking pies for another decade.

It's time for banks to do their own testing, quickly pop up some APIs, run hackathons and engage with partners, fintechs, and customers around the topic, to plot and test some business scenarios, tweak what worked and throw away what didn't work.

Someone will find new value and figure out savvy ways to monetize it. It might as well be you.