Scotland’s fintechs can unlock the power of open banking

There are over one hundred fintech companies thriving in Scotland’s fintech community with a range of new start-ups, existing firms developing their fintech offers and tech-driven firms re-locating north of the border. The launch of open banking last year has played a key role in fuelling the growth of this sector and the UK as a whole is now recognised as a world leader in open banking innovation. 

So far, much progress in open banking has been made in the small business environment where innovative products and services are already in the marketplace such as tools for monitoring cash flow and accessing finance. An important contribution to this innovation was the first Open Up Challenge in 2017 and 2018 – spearheaded by the Competition and Markets Authority (CMA) and run independently by Nesta Challenges. The Challenge was part of the CMA’s package of measures introduced to stimulate competition in the financial sector and help small businesses save time and money, find better services, reduce stress and discover the intelligence in their financial data. Winners included fast-growing fintech brands such as Swoop, Funding Options and Coconut whose products are frequently used by freelancers and small businesses across Scotland. However, as important as it is, the small business space is just the start of the open banking revolution.

When we consider the consumer market, while there are products that are already in use it’s fair to say that take-up has not yet been widespread - especially in light of research showing UK consumers stand to gain £12bn a year from open banking-enabled services[i]. Awareness of open banking is still low, with new research from Nesta Challenges showing that 55% of people in Scotland have not heard of it. 

On the other hand, 46% of Scottish people say that they want to feel more in control of their finances and 33% want personalised information and guidance to help them manage their finances. For people in Scotland the two biggest benefits of using an open banking enabled product are seen to be: saving money and finding better deals. These findings present big opportunities for those fintech companies and start-ups in Scotland developing open banking-enabled innovations for consumers.

That’s why Nesta Challenges, in partnership with Open Banking Ltd, has launched the Open Up Challenge 2020 - a £1.5m prize fund to encourage fintech innovators to create solutions that will help people to make more of their money.     

With Open Up 2020 we want to attract breakthrough innovations designed to support hundreds of thousands of people – particularly the most vulnerable. We’re looking for fintech innovators that can unlock open banking’s potential to change the way that the UK manages its money – especially for the 15.2 million who regularly run out of money each month.

Open banking represents a genuinely new way of empowering people with their data – it is a key milestone on the journey to a digital economy, and the Open Up Challenge has an important part to play in encouraging people to make their data work for them. Open Up 2020 will not only help people better manage their money and take control of their data, but it will also support Scotland’s growing and thriving fintech sector by fast-tracking innovative new products and services. Applications for Open Up 2020 are open until October 2nd2019 and guidance on how to apply can be found at In addition, the Open Up 2020 team will be holding office hours at Codebase, Edinburgh on Thursday 12thSeptember – book your slot hereto benefit from tailored application support from the Open Up Entrepreneur-in-Residence Sarah Tierney.

[i]Consumer Priorities for Open Banking 2019