Open Banking and Payments Competition

It's a great idea, but it's been killed off by the small print that was lobbied into the requirements

Basically, banks force apps or users to require you fully revalidate user consent every 90 days. And it's quite an annoying process. That means any app or integration you want to build, requires 10 minutes of your time every 90 days or they stop working. It's killed many Fintech's.

It all works on paper, but is drafted into law by politicians who have no clue about technical challenges and user experience. So in the end, it works exactly as designed by the banks: it doesn't

I'd be more than happy with read-only access. Still potentially bad for 'normal users' but not disastrous.

It's for SEPA area BUT it's mandatory open only for PSPs/financial institutions cutting out end customers... Also most banks have a terribly limited support. Personally I use OpenBank APUs (PSD2/DSP2) for some banks (ironically via a Canadian operator, GoCardless) and well... generic accounts are supported, stocks are not, bank cards are not etc, most exports have very poor quality.

Long story short I can auto-import in Firefly III from EU banks only via a Canadian company and the quality of the process NOT due to GoCardless but due to local banks is terrible...

That's why stablecoins are booming...

I was really disappointed by that. I still can't easily retrieve a list of my transactions.

^ this.

"Open Banking" is just… not open at all. Misleading name.

Had similar idea - just to pull my own data, tag transactions, etc etc, and have a nice stats. Nope, it is so "open" that it's just impossible to pass for single-user idea. "Open Banking" just gives me opportunity to show in my Bank A part of data from Bank B.

If you're in the EU it might be worth checking out if TrueLayer support your bank.

Bitcoin does seem like a great store of value, but as far as I know transacting with it is still quite expensive, and obviously not accepted in most places. Watching the USD be devalued in real time while BTC or Gold maintain value does drive home its utility as a store of value for sure.

But I can't buy groceries or pay rent with it, so i don't see how it works for the usecase I was talking about above. There's lots of ways to convert back and forth but you pay fees on each conversion so it's not economical to use for payments.

What does it mean that you are your won bank?

Do you treat your matrass like a bank? Maybe with the pidgin carrier protocol to do money transfers?

This is not the problem. If it was the problem then banks in (most of) the rest of the world would also be stuck 50 years in the past. They're not.

That's why Im really bullish on Column, a tech company with banking license

This is only true of small banks, not large ones.

Yes, there is Open Banking in the UK: https://www.openbanking.org.uk/ It's the UK version of PSD2 so there should be equivalent schemes in Europe.

Not that it really is as open as many of us might like - the banks did a pretty good job of tying much of it up in red tape.

I use the GoCardless API to pull transactions and balances into a Google Sheet. They have pretty good coverage for UK and EU it looks like [1]

[1] https://developer.gocardless.com/bank-account-data/overview#...

PSD2 is that standard.

I personally use Finanzguru (for the German market, it supports many banks).

Likely to be many others.

Open banking does that but it needs to be a provider.

Some banks let you download in formats that let you then import into something. I have imported a lot into Gnucash from a downloaded file but its not smooth or complete (narrative needed fixing).

A quick search shows this one is well regarded https://www.bilanceapp.com/

That's the problem with those things. Who's responsible for plumbing leaks?

A sizable fraction of what bank employees do involves error conditions and fraud. The happy path has been automated for decades. One of the big discoveries when PayPal started up was that they were not in the money transfer business. They were in the fraud prevention business.

Oh man, so true. Don't even get me started on the red tape in EU.

use the open source tech made for public blockchains and use that to build new banking rales for public/semi public banking networks

> Banks are pretty good at not losing data

Except for that day I logged into Barclays Bank (in the UK) and half the transactions were missing from the last several months of statements.

We're talking maybe 50 transactions just gone from the bank account ledger, which had long since been settled and previously downloaded (that's how I noticed).

To be fair to them, the transactions reappeared a few days later. But it took days, and had me quite worried.

> I mean there's fraud and theft on all levels

you are confusing payment card issuers and processors with banks

The bank isn't so interested in whether it's a good idea to open a shoe store or not, but in whether you as the person asking for lending has the skillset to actually execute on that plan. Asking the person who wants lending to write the plan is the easiest way to check this.

The business plan is not about the business plan.

It's only even half about the business. Instead it is about the businessman making the pitch.

If someone is good at baking bread that suggest they are qualified to to bake bread. Running a bakery is a super set of that skill. The business plan request is a fantastic method to give such a person a chance to show they have the right resources, enough experience, and reasonable expectations and strong commitment.

Well of course. That’s how most gatekeepers act.

Why does every employee in the US need to pay an accountant to file their corporate payroll taxes, when the corporation knows how much they paid and can just use THEIR accountant to report this same information? It would be standard across many employees. And in Europe that’s largely what’s done. But in USA this creates many “bullshit jobs”. The IRS just closed their free file under Trump admin, and even when they had it, you had no way to electronically submit business taxes, and even if you mailed those to the IRS (still allowed) some states have NO WAY for you to file taxes without an accountant!

To open an LLC in NY you must announce it in a specific newspaper they tell you. And that newspaper charges $700. Same thing — they lobby to keep this going.

Crypto and blockchain by itself does not solve any of these problems. It's merely a payments system that happens to be on a computer natively. There's nothing technical preventing banks from getting together and making Open Banking a well-supported thing like they're supposed to be doing; it's all just code and contracts in the end. It's not that they can't, it's that they won't, and they won't for business and political reasons. Crypto is subject to the same pressures but doesn't have the same regulations to constrain their actions. Crypto's better ability to eg do international payments is not because of any technical reason but simply because they don't have the same regulations and inertia of the traditional banking system. While the traditional banking system has problems with its regulations making things too hard to do, many people prefer it to the easier to screw up wild west of crypto payments. Lots of people like the FDIC making sure their savings aren't wiped out if the bank lies on its balance sheet, or the ability to claw back money transfers if someone breaks into their account. Crypto could certainly provide those services and backstops, but they haven't yet, and based on the prevailing attitude amongst the major participants, it's unlikely they will anytime soon. The only real difference between crypto and banks as a payments system is whether or not you want to start from scratch and build up, or start with the existing morass and tear down. The latter is the safer option which many people prefer when it concerns their money

Anytime I've tried to buy something with crypto, the fees have been an order of magnitude higher than interchange (credit card) fees. And unlike credit cards, the cost is put on me not the merchant.

You can't be sure of anything just because a crypto wallet appears to have a number in it, because the legal system exists, and judges don't care what you think a number means if they think something different.

Mainly this comes up during bankruptcy, but they can also just order you to return stolen funds you've received even if you would prefer not to do that.