Here’s how open APIs could work against fintechs

There has recently been a spurt of media coverage on the decisions of challenger banks, including UK-based Starling and Monzo, to mirror incumbents and open up their application programming interfaces (APIs) to third parties.

While Monzo has not explicitly said it will open its API, it intends to operate as a marketplace through which third parties can offer their services to Monzo’s clients, and the easiest way to aggregate external products is via an open API. Opening up their APIs to third parties can benefit challenger banks by allowing them to offer a broader product suite to their customers, but there are also risks attached to this strategy.

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