The long-awaited Section 1033 rule on open banking was finalized by the Consumer Financial Protection Bureau on Oct. 22, and financial institutions are weighing in on the regulation. 

According to a January report from Future Markets Insights global revenue from open banking services totaled $22 billion in 2024 and is expected to reach $133 billion by 2034.

Major financial institutions have been preparing for the regulation for months, even years, and are looking to vendors and their core providers to help them prepare for the changing financial infrastructure per CFPB guidelines. 

These were Bank Automation News’ top five open banking stories of 2024: 

1. FIs weigh in on US open banking regulation 

Citizens Bank, Valley Bank, Mastercard and data-sharing platform Plaid discussed how open banking might affect the financial services industry in the U.S. 

To prepare for open banking, Citizens Bank and Valley Bank have developed API infrastructure while Mastercard is working with fintechs and FIs to develop solutions for open banking. 

2. Open banking: An opportunity for banks to sell data

As banks gear up to share data with one another and fintechs, they are looking into monetizing data sharing. 

FIs in Europe and the United Kingdom including ABN Amro Bank, BBVA and Santander Bank, are exploring opportunities around data sharing. Banks argue that if sharing data is profitable for banks, they may be more open to adopting the framework.  

The CFPB’s open banking rule bans FIs from generating revenue from data sharing, but many FIs are still exploring how to monetize data sharing for an additional source of revenue while maintaining compliance. 

3. Larger FIs may need more time to implement open banking 

The CFPB has provided varying timelines for banks, according to their size, to implement open banking. For example, banks with more than $250 billion in assets must be compliant by mid-2026 while banks with less than $1 billion in assets have until mid-2030 to comply.  

However, many argue that it’s the larger FIs that could need more time. With operations spanning multiple geographies and multiple business lines, big banks may find it more difficult to share data with vendors within the timeline set by CFPB, despite their big tech budgets. 

4. Financial inclusion boosted by AI, open banking, education 

Open banking holds a great deal of promise, ranging from boosting revenue to growing the customer base to expanding the net of financial inclusion.  

Sharable data can help FIs make credit decisions that give the unbanked population in the U.S. greater access to credit. 

5. 75% of global banks unprepared for open banking 

While major FIs across the globe have been adopting an open banking framework for nearly a decade, close to 75% of banks globally are still unprepared to share data safely, according to think tank Forrester. 

AI can help FIs share data securely, optimize data sharing and create innovative products to magnify the opportunities that come with open banking. 

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