“Is it a big project? Yes. It is cross-cutting, it means it goes across all firms - forgetting open banking for a second - it goes across all firms that we regulate as the FCA. It’s about us being ready for implementation and supervising firms as we normally do," she said.
Seaton noted that the industry has to some extent put open banking to one side and it is seen as something it does not need to worry about.
“What we are underestimating at our peril is the amount of data that it informs and the insight it gives about customers," Seaton said.
“It’s almost like the heartland of our customer because we can see what people are doing fundamentally with their money.
“The conclusions you can draw informs you so well and this can all be automated,” Seaton said.
Seaton’s tip for firms is to look at open banking in a way that can provide the automated insights needed to inform ongoing suitability.
“You don’t need to be talking to your customer all the time,” she said.
Oger-Zaher agreed and noted there is a “real closeness in terms of spirit” between the two and a lot of relevance when you think about it from a technology perspective and how one can support the other.
The role of data and technology
Accenture's non-financial risk specialist, Anne Godbold noted that firms should act to use the data they have on customers to deliver on their consumer duty obligations.
"Firms do have a lot of data, but it doesn’t necessarily build in to delivering customer centricity. The traditional customer segments that we are used to is based on normal, simple demographic data - age, income, education. But how often does the bank really know what your financial objective is, what you are trying to do?," she asked.
“Now the FCA has been really clear, it’s talked a lot more about granular data and they’re really nudging firms to rethink this and making sure they really understand customer groups in a way that is useful. Thinking about the jobs to be done, what the objectives are and thinking about how do you help them at the right point in the journey," Godbold said.
In Godbold’s view, the innovation that will come from this is what is most exciting.
“To date most of our firms are really working on getting their backbone in place, using the data they’re got to monitor this. They haven’t yet gotten to the place where they’re implementing new data sources, that is to come," she said.
She gave the example of firms using generative AI to help them use the data they’ve got to respond better to customers, but noted that the cost of this may be prohibitive unless firms start to use the data they have got effectively.
