U.S. banks are enhancing tech stacks with APIs, collaborating with vendors and drawing insights from the U.K.’s open banking rule to comply with the new U.S. open banking regulation.  

The Consumer Financial Protection Bureau approved an open banking rule on Oct. 22, mandating financial institutions to share financial data upon consumer request. 

READ MORE: Open Banking: Decoding Section 1033  

The U.K. and European Union have open banking regulation in place, so FIs in the U.S. look to them for strategies to successfully implement open banking, Alyson Clarke, principal analyst at research and advisory firm Forrester, told BAN. 

Europe and the U.K. are “much further advanced in open banking” due to regulatory enforcement, Clarke said, adding that FIs there are prioritizing partnerships with vendors and tech companies like Apple to grow operations. 

With the open banking mandate, many big tech companies like Apple can drive higher customer engagement than banks, Clarke said.  

“Smart banks will want to partner up” to grow operations, she said.  

Truist’s open banking strategy

Kelly Buchanan, divisional chief investment officer at Truist Financial, told Bank Automation News that regulation in the United States was a long time coming.

“Europe and many other countries have had much higher adoption in it already,” she said.  

To follow the U.K.’s open banking model, FIs need to develop their own APIs and team up with vendors for data-sharing capabilities, Buchanan said. Truist is “working with all teams and making sure that we have the right capabilities and the partnerships” to be compliant with the U.S. open banking mandate. 

As part of its preparation, the Charlotte, N.C.–based bank has developed internal APIs to share data among departments, Buchanan said. It is API-ready and will expand its data connectivity by joining data-sharing platforms like Plaid for open banking, she added. 

“Working with vendors is a key part but securing safety of data through our APIs is just as important,” Buchanan said. 

The $526 billion bank has also hired staff to oversee the open banking transition, she said. 

Truist named Anthony Burton as senior vice president and head of open banking in November 2023, according to his LinkedIn profile. Burton is responsible for making sure Truist’s tech stack is ready for open banking and safe data sharing, Buchanan said. 

SVB follows in U.K. footsteps

Silicon Valley Bank has learned from former U.K. counterpart SVB U.K., how to prepare for open banking, Milton Santiago, global head of digital solutions, told BAN. 

The bank brought the same data-sharing capabilities to its U.S. operations to provide customers with payment origination, check issuance capabilities and embedded Automated Clearing House origination, he said. 

SVB doesn’t expect to execute major changes to its tech stack to be compliant with Consumer Financial Protection Bureau’s Section 1033 ruling, Santiago said. 

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