Taiwan is moving forward with its plan to embrace open banking. The country’s Financial Supervisory Commission (FSC) recently granted approval to seven banks to enter the second stage of open banking, Regulation Asia reported earlier.
The second phase of open banking, which focuses on consumer information inquiry and involves the exchange of customer data, will give customers of these seven banks access to services provided through open banking. It will include 18 APIs for customer information inquiries and low-risk service applications.
Customers will be able to give consent for their information to be shared, and be able to check their deposit account balances, transaction details, and other information held by any of the banks within a single mobile banking app.
The seven banks selected to enter the second stage of open banking are South China Commercial Bank, Yuanta Commercial Bank, CTBC Bank, Mega International Commercial Bank, First Commercial Bank, Cathay United Bank, and Far Eastern International Bank.
Far Eastern International Bank said in December 2020 that it had been working with affiliate Far EasTone Telecommunications Co on an account integration app. The new app will allow customers to integrate their accounts at different banks, allowing them to manage their savings accounts, bills, credit cards and funding through one interface.
The app uses artificial intelligence to recommend the most favorable options for customers when making wealth management decisions or choosing banking services, the Taipei-based lender said.
Taiwan’s three-phased open banking plan
In November 2018, the FSC assigned the Bankers Association and the Financial Information Service Company (FISC) to plan and develop an open banking program, including regulations and technical standards for banks to follow.
The first phase, which included APIs for non-transaction data inquiry and standards for cybersecurity, was published at the end of 2019. It focused on making public product information, including credit card, fund an d mortgage interest rates, searchable by third party service providers.
The third phase will include financial transaction related services and actual banking transactions.
Taiwan is following the lead of countries like Singapore which have so far not impose formal or compulsory open banking regimes, but have instead introduced a range of measures to promote and accelerate the take-up of data sharing frameworks in banking.
In Singapore, the Monetary Authority of Singapore (MAS) and the Association of Banks in Singapore (ABS) published a comprehensive roadmap, titled Finance-as-a-Service: API Playbook in 2016. The playbook set out a comprehensive framework that introduced governance, implementation, use cases and design principles for APIs, together with a list of over 400 recommended APIs and over 5,600 processes for their development.
Meanwhile, Japan has adopted an organic approach to open banking. In June 2018, Japan’s Banking Act was amended to promote open banking and although implementation was voluntary, more than 100 chartered banks in Japan were expected to open their APIs in 2020.
