Globally, consumers have become increasingly aware of the importance of data privacy, and with new regulations emerging, businesses have to re-evaluate how they handle customer data. Nick Caley, vice-president, financial services and regulatory at ForgeRock, describes the overall readiness of the market in a new regulatory landscape. Briony Richter reports
In January 2018, the UK implemented Open Banking, giving consumers more choice, more control and a quicker, easier and more efficient way of accessing their financial data.
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Overall, it has been a relatively slow year, and across the financial industry, many UK banks have not yet fully embraced the benefits of Open Banking. A regulatory revolution, however, is kicking off globally, as more countries implement their own versions.
Those that take steps to safeguard data in the new regulatory environments will build consumer trust and be able to deliver more personalised products and services. Speaking to RBI about the complexity of data identity and governance, ForgeRock’s Nick Caley says:
“It is very complex. On the other side there is a great deal of sophistication from cybercriminals, but my personal opinion is that there is a plethora of technology that means this problem is not insurmountable. There’s been massive innovation in cybersecurity over the last 10 years, with the cloud and data analytics.
“In the large part, there are a lot of organisations that are staying ahead of the curve,” he adds. “The challenge is that they have to be good all day every day; a hacker only has to be good once.
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By GlobalData“At ForgeRock, the company has been a leader in innovation, developing a digital identity platform that makes the customer journey more safe and seamless, and innovates into the space of the Internet of Things.”
ForgeRock was invited as one of the technology providers right at the outset with the CMA 9 – the UK’s nine largest banks and building societies – to help define the standard with which everyone needs to comply.
Since then, it has been working with a number of banks in providing that sandbox as a service, so they can meet some of the deadlines that are necessary to being PSD2-compliant. So with all the benefits out there for the financial industry, why the slow start?
“There’s a world of compliance and legacy infrastructure that can stop banks from being as innovative as the customer desires,” Caley highlights. “Of course, legacy systems certainly keep the banks back.
“I think banks are really up on the cyber side of things. Competition and customer satisfaction will be crucial. What we will see is increased adoption of Open Banking as it integrates more into mobile banking.”
Thursday 14 March 2019 was the deadline for banks in Europe to comply with the next significant stage of PSD2, relating to the implementation of testing facilities for APIs, although ForgeRock highlights that a large number of the more than 9,000 applicable banks were expected to miss the deadline.
“Competition will become fierce and more apparent quickly, because fintechs will be testing banks with the availability of these interfaces in the first deadline,” Caley notes.
Globally, customer experience is going to be absolutely crucial. PSD2 is an opportunity for banks to embrace new technology such as biometrics and machine learning, to enhance data security and the overall experience.
Over the next year, the financial industry will witness increasingly high levels of regulatory demand. Personalisation must come with privacy, and for ForgeRock, identity sits at the heart of every interaction. It aims to transform the way businesses handle identity, so they can always provide a trusted digital experience.
Concluding, Caley says: “We will continue to extend digital identity for not just the immediate use cases, but also the emerging requirements aligned with ecosystems. We have a strong focus on enabling ecosystems – Open Banking was one of those. “We are at an interesting point. Beyond regulation, the state of data ownership has moved: now customers own their data.”
