Imran Ghulam Hussainwala is one of the leading experts in the open bank in the world. As head of the Open Bank Enforcement Agency (OBIE) in the UK, he is primarily responsible for determining the direction of this process in the country, which is a pioneer and a global reference in this regard. And he says Brazil seems to be on the right track.
Gulam Husseinwala this Wednesday participated live with Diego Alvarez, founder and CEO of Giapolso and a member of the Open Bank Planning Council in Brazil. When asked about how this management system works here, he commented that Brazil “seems to have learned from our mistakes, which is excellent”.
An example of the “mistake” he made was that it was initially intended to be used on open banking systems, but later the formulators found that the customer experience was not good and that the focus should be on the cell phone. . “It took us a year and a half to go back and do everything again,” he said.
One of the differences between the two countries is that in Brazil, each of the seven members of the Planning Commission – representatives of the banks, fintech, cooperatives and card companies – voted, while in the UK the board has more consultation, with Ghulam Husseinwala as chairman of the body being able to make decisions where there is no consensus.
“My job is to try to build consensus in the group, but if that’s not possible, I can impose a decision. .
Imran Ghulam Husseinwala, Chairman, Open Bank Enforcement Agency of the United Kingdom (OBIE) – Photo: Disclosure
According to Ghulam Husseinwala, the implementation of open banking is a global phenomenon that is already becoming a reality in many countries, and for many reasons. “The biggest question I always ask when open banking is implemented in any country is: ‘Why?’ There are also different reasons.In the UK and Europe, consumers have a right to their data, and if you can do it right, [o open banking] Corrects many imbalances in financial services ”.
According to the executive, open banking helps people solve financial problems, save money, find better products and manage their financial lives, stimulate competition and promote Fintech’s ecosystem.
In the UK, most open bank transactions are still data transfer, but fee transactions are starting to pick up speed, he explained. “The point is, in payments, the response time should be very fast because there you have to compete with the cards. In terms of data, people accept a little more friction.”
In the United Kingdom, customers are entitled to four free API calls per day, the same as in Brazil, 120 per month. Ghulam Husseinwala said the limit was not an issue. Each bank or Findtech is required to renew customer approval for data sharing once every 90 days. In Brazil, this period is 12 months. “If you have an account with three banks and three fintechs, you have to renew 12 credentials every 90 days, and we have seen many withdrawals. The EU is discussing this and I think we will make changes soon.”
Another thing that Englishmen read and report on quickly is the so-called continuous payments, but different values (variable continuous payments or VRP for short in English). That way, you can make a free Uber to deduct a certain number of payments from your account for a limited period of time, setting a cap on a transaction and the total amount.
Ghulam Husseinwala also commented on open funding, which includes insurance, investments and other services in addition to banking products. He added that in the UK, as in Brazil, it involves different regulatory authorities and it is difficult to reach a consensus. “In this case, we are jealous of what is being done in Australia. We are not yet clear how this will work in the UK.”
According to him, OBIE will receive new functions and will be able to integrate open funds, including non-financial institutions such as electricity, telecommunications and social networks. “Can a bigger approach do this with a standardized approach, is it better for consumers, or is every company being pulled in different directions, so it’s very difficult for customers to use. We have big discussions, but I hope we can decide which way to go throughout 2021,” he said. He commented: “The reasons for doing so together are credible, but sometimes politics leads.”
According to him, one of the reasons why large technology companies are so powerful is because they have so much data that, at least in theory, they can be shared in an open financial environment. “It doesn’t matter if it’s bank information or your Spotify account information, it could flow through data and APIs.”