Wider adoption of open banking could generate up to £43bn in annual economic benefits for the UK, according to new research published as regulators assess how the technology should be governed in the future.
The analysis, conducted by EY for Open Banking Limited, estimates that open banking has already delivered about £8.3bn in cumulative benefits to the UK economy. The study suggests that broader adoption across financial services could increase those gains significantly over the coming years, potentially generating £7.4bn annually within five years if the technology becomes more widely integrated.
Open banking allows consumers and businesses to share their financial data securely with authorised third parties, enabling banks, fintech companies and other providers to develop new financial products and services. The framework is designed to increase competition and innovation in financial services while giving customers greater control over their financial information.
The research arrives at a time when policymakers and regulators are reviewing proposals for the next phase of the UK’s open banking framework. The review is expected to examine governance arrangements and how the system should evolve as adoption expands beyond its original scope in retail banking.
Supporters argue that wider implementation could accelerate innovation in payments, lending and personal financial management. By allowing financial institutions and technology firms to access customer-authorised data, open banking can enable more tailored services and improved decision-making tools for both individuals and businesses.
The projected economic benefits reflect potential productivity gains across the financial system as well as efficiency improvements for consumers and companies using digital financial services. Advocates say these advantages could strengthen the UK’s position as a centre for financial innovation while helping create a more competitive banking market.
The research highlights how open banking has already begun to reshape financial services infrastructure in the UK. However, its future impact will depend on how regulatory frameworks evolve and whether adoption continues to expand among financial institutions, fintech providers and consumers.
