Open Banking usage is increasing among fintech start-ups, with 75% of new fintech products using Open Banking APIs to boost functionality, according to a recent report by Statista.

In the B2B sector, Open Banking is powering advanced tools like:

• automated invoicing, 
• cash flow forecasting, 
• treasury management. 

While B2C applications are leveraging it for personalised financial management solutions.

These developments highlight the critical role of Open Banking in driving innovation and user engagement across both markets.

According to a study conducted by McKinsey, Open Banking is expected to shortly comprise 64% of global financial data sharing, as indicated by recent insights from industry reports. Additionally, PwC projects that Open Banking-enabled predictions may lower credit risk for lenders by 30%, thanks to the increased transparency and accessibility of customer data. These insights illustrate the escalating importance of Open Banking in crafting reliable and actionable financial forecasts.

Predicting trends has become essential for individuals, companies, and investors in the ever-evolving financial world. As the PSD2 framework approaches its 10th anniversary between now and 2029, this article aims to define the major opportunities for the widespread adoption of Open Banking.

Financial prediction is key

Financial prediction serves not only as a means of forecasting but also as a critical strategic requirement. By effectively anticipating market trends, economic changes, and consumer behaviour, organisations can:

• Optimise decision-making: Accurate forecasts enable organisations to distribute resources effectively and reduce potential risks.
• Enhance customer satisfaction: By gaining insights into customer preferences and spending behaviours, banks and fintech companies can customise their services to address specific requirements.
• Boost profitability: Predictive analytics drive more intelligent investment decisions and enhance operational efficiency.

In a progressively data-centric economy, maintaining a competitive edge relies on the capacity to convert unprocessed data into practical insights.

Role of Open Banking in financial forecasting

Open Banking is transforming the manner in which financial data is exchanged and leveraged. Fundamentally, Open Banking facilitates secure data sharing among banks, fintech firms, and external service providers, promoting innovation and enhancing competition.

Here’s how it contributes to financial prediction:

1. Access to richer datasets: Through the consolidation of customer information from various sources, Open Banking offers a comprehensive perspective on financial behaviours and trends.
2. Real-time insights: The focus on real-time data access in Open Banking enables faster and more precise forecasting.
3. Personalised analytics: Financial institutions can utilise Open Banking to create bespoke predictive models that cater to the unique requirements of clients or specific market segments.

The year 2025 is projected to witness the advancement of Open Banking trends, resulting in more extensive integrations and sophisticated predictive capabilities.

Openness and transparency

Openness is a key principle at Exthand, and we approach this trend with utmost seriousness. We are proud to contribute to the worldwide movement towards transparency in financial applications.

A comprehensive selection of state-of-the-art tools and approaches is applied to encourage greater openness and transparency:

• Artificial Intelligence (AI) and Machine Learning (ML): Algorithms powered by AI are capable of detecting patterns within extensive datasets, thereby delivering precise predictions regarding market fluctuations and consumer behaviour.
• Big Data Analytics: The integration of Open Banking data with big data analytics facilitates a more profound understanding of both macroeconomic and microeconomic trends.
• API Ecosystems: Application Programming Interfaces (APIs) facilitate efficient data exchange among institutions, promoting the smooth incorporation of predictive tools.
• Blockchain Technology: By improving transparency and security in data exchange, blockchain technology guarantees the dependability of predictive analytics within open banking systems.

These technologies enable financial institutions to forecast trends with an unparalleled level of transparency, promoting openness and collaboration within a progressively digital marketplace.

Case studies highlighting the crucial role of Open Banking in the financial future

The practical application of open banking in financial prediction is already evident in numerous success stories:

1. bunq, the 2^nd neobank in Europe and its IA assistant, Finn.

bunq, the second-largest neobank in Europe, has formed a partnership with Mastercard to provide its 12.5 million users with a comprehensive financial overview. Utilising Mastercard’s Open Banking platform, users can link accounts from any financial institution to the bunq application, thereby simplifying their money management processes.

This collaboration allows bunq’s AI assistant, Finn, to offer enhanced spending insights by evaluating transactions from various banks. Users can conveniently monitor specific expenditures, such as travel expenses over the previous year, with a straightforward request. This positions bunq as the first European bank to incorporate AI into the realm of Open Banking.

The results are evident—within just two weeks of the launch, nearly 40% of users surveyed indicated an increase in their app usage. As an increasing number of Europeans manage multiple bank accounts, bunq is facilitating effortless financial management.

2. syncfy.com powers open data across Latin America using blockchain. 

Syncfy is revolutionising financial connectivity in Latin America through its integration with an extensive network of banks, financial institutions, government entities, and service providers. By effectively consolidating data from a variety of sources – including traditional banks, digital wallets, utility companies, and blockchain technologies – Syncfy offers businesses a comprehensive perspective on both financial and non-financial information.

This extensive integration allows companies to gain real-time insights, optimise financial operations, and improve decision-making processes. Whether it involves retrieving banking transactions, examining tax information, or validating payments across various platforms, Syncfy streamlines data aggregation, thereby enhancing the efficiency and transparency of financial management.

By connecting disparate financial ecosystems, Syncfy is paving the way for the future of open finance in Latin America, equipping businesses and users with seamless access to essential financial data.

3. Yodlee: powering Open Banking innovation through data. 

Yodlee stands at the forefront of data aggregation and analytics, serving as a cornerstone for innovation in Open Banking. With the trust of over 1,500 financial institutions and fintech companies, including 15 of the top 20 banks in the United States, Yodlee’s services extend to more than 30 million customers globally.

By leveraging Yodlee’s insights, banks and fintechs are able to gain a more profound understanding of their clientele, which facilitates more precise risk assessment and the identification of new business prospects. This data-centric methodology empowers institutions to provide tailored financial guidance, thereby improving customer engagement and fostering loyalty.

Through its extensive network and robust analytics capabilities, Yodlee is influencing the evolution of Open Bnking, assisting financial organisations in transforming raw data into more intelligent and personalised services.

These examples demonstrate how Open Banking has the power to reshape the upcoming landscape of financial forecasting.

Conclusion

As we approach 2025, the combination of Open Banking and financial prediction promises to provide new possibilities and efficiency within the financial sector. Open Banking trends have a significant and far-reaching influence, from improving consumer experiences to encouraging wiser investment decisions. By adopting the strategies and methods discussed earlier, companies can maintain a competitive edge and flourish in a fast-changing financial landscape.

The future of finance lies in the seamless integration of Open Banking and predictive analytics – a partnership that is set to redefine the way we understand and interact with money.