Leon Muis of YTS: “Open banking paves the way for open finance & open data”
The 2020 edition of FinovateEurope took place from the 11 to 13 February. The conference, held for the first time in Berlin, is one of the most important fintech events in the world. Every year since 2007 it gathers hundreds of industry experts and companies in search of innovation and opportunities.
At the event we had the pleasure of speaking with Leon Muis, open banking and PSD2 [Second Payment Services Directive] expert and chief business officer of Yolt Technology Services. YTS is one of the main open banking providers in Europe, offering payment initiation services, account information services, and data enrichment services to leading financial institutions and ambitious tech businesses.
What do you think of the evolution of open banking into open finance?
“Open banking is good, it is the start of a trend that will move more and more towards open finance and therefore it will include not only payment accounts, but also investment accounts, mortgages and loans. This transition will in turn lead to open data (the availability of all kinds of data to all sectors, ed). PSD2 and open banking have been a starting point and have paved the way.”
“More and more companies are beginning to offer financial services, also companies that are newcomers in the financial area – such as retailers, utilities, automotive and many others. Uber, for instance, is a taxi company that provides also bank accounts for its drivers thus turning into a financial services company. Moreover, Uber wins the loyalty of drivers, who become its clients too, making margins on these financial products. Therefore, I think we will see more and more companies offering this kind of products and services”.
The finance sector is highly regulated. Will all the companies, including the non-financial ones, need a licence?
“Nowadays, a licence is necessary to operate in many fields, such as payment initiation services, as they are regulated under PSD2. However, many companies don’t want to apply for a licence right away: first, they want to make sure their business model actually works, hence they choose to leverage other institutions, such as open finance platforms, that already have the requested licence; if they realise that their model works out, then they might apply for their own licence, otherwise it would be a very big waste of time and money”.
What effect do you see on financial services caused by Brexit? And on open finance platforms like you?
“With ING, we operate in the UK as well as in France and in Italy, and currently we are still using ING banking licence which is passported from the Netherlands to the UK. If after Brexit this operation will no longer be feasible, we will need licenses both in Europe and in the UK. But for the moment we are in a transition regime and we can keep operating in this manner. Brexit could also represent an opportunity for us, since many financial services providers are leaving the UK, such as for example N26”.