Rising demand for Open Banking: Security and privacy lead consumer preferences

Rising demand for Open Banking: Security and privacy lead consumer preferences

As Open Banking continues to redefine payment methods, emerchantpay’s latest research highlights the driving factors behind consumer choices at online checkouts.

According to the study, a significant emphasis is placed on security, with 60% of consumers ranking it as their primary concern, followed closely by privacy at 41%. The research also underlined the importance of speed (38%) and efficiency (34%), traits that Open Banking payments notably excel in.

This method not only meets but often exceeds the capabilities of traditional payment methods, underlining the increasing consumer demand for these features. The findings suggest that Open Banking could see a significant uptick in adoption rates, as merchants are encouraged to integrate it into their payment systems to maintain relevance and customer satisfaction.

Previous studies by emerchantpay pointed out that while a sizable portion of the UK population was unfamiliar with Open Banking, a change in perception was noted once they were informed about the payment method. After an explanation, 58% of respondents recognised they had already used Open Banking for transactions online. This indicates a substantial gap in awareness that, once addressed, could boost usage significantly.

Jon Horddal, Chief Product Officer at emerchantpay, explained the consistent popularity of Open Banking. “To maintain customer loyalty and reduce the risk of checkout abandonment, merchants must keep up with consumer demand when it comes to payments. These findings underscore the importance of integrating Open Banking as a method that goes beyond others to provide the highest level of security, data privacy, speed and efficiency.

“To unlock the greatest benefit from Open Banking Payments, however, merchants must help educate consumers about the advantages it offers, to encourage uptake. Despite 66% of consumers indicating they’ve never received communication from their banks regarding Open Banking, a staggering 88% expressed that transparency remains a critical factor in trusting banks and third-party providers. This highlights the need for educational efforts, which could be as simple as providing a brief, written explanation at the checkout.”

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