Open Banking Market Size - By Banking Services (Banking & Capital Market, Payments, Digital Currencies, Value-added Services), By Distribution Channel (Bank Channel, App Market, Distributors, Aggregators), Deployment Model & Forecast, 2023 - 2032

Open Banking Market Size - By Banking Services (Banking & Capital Market, Payments, Digital Currencies, Value-added Services), By Distribution Channel (Bank Channel, App Market, Distributors, Aggregators), Deployment Model & Forecast, 2023 - 2032

The Open Banking Market size will exhibit over 20.5% CAGR from 2023 to 2032. Open banking, which fosters collaboration between traditional financial institutions and innovative fintech companies, is poised to revolutionize the industry. The increased customer demand for personalized financial services has pushed traditional banks to embrace open banking as a means to stay competitive.

Additionally, regulatory initiatives, such as PSD2 in Europe, have mandated banks to open their data, fostering a more open and competitive environment. According to the PSD2 in Europe, banks need to create mechanisms that will enable third-party providers to work securely and rapidly. On the other hand, the rapid advancement of technology, including APIs and blockchain, has made it easier for financial institutions to share data securely and efficiently.

The open banking market is divided based on banking services, distribution channel, deployment model, and region.

The payments segment could witness commendable growth from 2023 to 2032. Within the open banking ecosystem, the payments financial services segment stands out as a prominent player. Open banking has revolutionized payment methods, offering consumers and businesses faster, more convenient, and cost-effective transaction options. With the advent of APIs, payment service providers can offer seamless payment experiences, leading to increased customer satisfaction. This segment is experiencing rapid expansion, with numerous fintech companies and traditional banks developing innovative payment solutions.

The app market segment will record a decent valuation by 2032. As mobile usage continues to soar, consumers are seeking integrated financial services within their favorite apps. Fintech companies are capitalizing on this trend by offering APIs and SDKs that enable other apps to integrate financial services seamlessly. This strategy not only expands the reach of financial services but also enhances user engagement. The app market distribution channel is poised to play a crucial role in the future of open banking.

Asia Pacific open banking market size could register noteworthy growth from 2023 to 2032. Rapid economic growth, a large unbanked population, and increasing smartphone penetration have created a fertile ground for open banking innovation. Governments in the region are also taking steps to promote open banking and fintech ecosystems. As a result, the Asia Pacific market is witnessing a surge in collaborations between traditional financial institutions and fintech startups, leading to the development of innovative financial solutions that cater to the diverse needs of the region.