Some of the best news we got this year was that we were the first UK lender to turn on Open Banking for our customers. It's with an great sense of pride that we're able to close the year by launching Open Banking with HSBC and Barclays too, bringing the facility to over 60 per cent of our customers.
Open Banking lets customers give verified third-parties, like us, access to their bank data through a secure application programming interface (API). Now, business owners who bank with either Barclays, HSBC or Lloyds can provide access to five years of bank statements in seconds to support their iwoca application.
It's big news. According to the Competition & Markets Authority (CMA), these three banks combined accounted for between 50 and 80 percent of the market share of UK business current accounts in 2015, the last year for which figures are available.
However, in a survey we carried out of 1,000 small business owners, we found that almost three quarters (73 percent) of those business owners didn't know what Open Banking is. The Open Banking initiative is approaching its first birthday, but awareness remains persistently low. We're working to change that.
We started our Open Banking jouney with Lloyds in November. The first ever business to turn on Open Banking was Jason, Director of The Bristol Fascia Company. He told us how pleased he was that Open Banking made applying for a loan so speedy.
We're not done yet. We're continuing to finalise connections with the remaining six high street banks. Connections to Santander and NatWest are close to being completed. We have been working closely with all nine of the banks since the initiative’s launch in January 2018.
Mark Chidley, Independent SME representative to the Open Banking Implementation Entity (OBIE) said that “iwoca’s announcement today demonstrates that the potential of Open Banking to transform how small businesses manage their finances is being realised. This is very good news for the UK’s small businesses who, according to recent Government figures, employ over 16 million people and have a combined turnover of over £2 trillion.
He continued “Open Banking has a powerful role to play in bringing together members of its ecosystem to provide small businesses with the ability to manage their businesses in a more productive, efficient and profitable way – helping to mitigate persistent challenges such as late payments, low productivity and inefficient access to credit. The OBIE looks forward to continuing to bring the many actors in the ecosystem together in order to fully explore and realise the benefits that open banking can bring to small business owners and UK plc.”
Our CEO, Christoph said that “our Open Banking team has been hard at work to add Barclays and HSBC to our first connection with Lloyds and I’m delighted that we can now offer almost two-thirds of our customers an easier way to get approved with us. Clearly there’s a need to raise awareness of Open Banking and help small business owners benefit from it, and we’d love to work with the banks and the Open Banking body to achieve that.
“We believe that what we do at iwoca is helping a vital sector of the country thrive. Business owners want to get on and do what they do best – running their own business. That’s why we want to make getting a small business loan from iwoca as simple as booking a plane ticket online. Open Banking is helping us to achieve that.”
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