Open Banking – facilitating innovation in the Payments industry

Innovation in the Payments industry has transformed the consumer relationship for our clients in the Banking and Finance sectors, and the convenience of Open Banking is now key to helping build and maintain their strong client relationships.

To help our client, a leading global financial institution, benefit from this transformation, we advised them on regulatory aspects related to setting up an Open Banking platform. The platform will ultimately connect banks to third-party providers, such as services that allow consumers to make online payments without the need for credit or debit card details.

The project is a great example of how our cross-practice expertise benefits our clients, as it required coordinated advice from several practice groups at our firm, spanning: Financial Services Regulatory, Data Protection, Cybersecurity, Competition Law, Contractual/Commercial Issues, M&A, InsurTech, and IP. We were able to advise across the full range of countries in Europe and Asia in which the client has offices.

This platform will transform the way our client interacts with their consumers, using it to seamlessly connect third-party providers to banks across the jurisdictions in which they operate. Our team in the UK (led by co-Head of Payments Group, Trystan Tether) and in Brussels (led by co-Head of Payments Group, Scott McInnes) made this possible, advising on the customer-facing documentation for the provision of their proprietary platform for opening banking.

As with much of the work in the Payments industry, our project was complicated by the fact that regulatory requirements in each of the jurisdictions are not necessarily aligned. Plus, the continued innovation in Payments technology and the growing use of digital currency and Non- Fungible Tokens (NFTs) has resulted in scenarios in which regulatory bodies are not always able to keep up with the advancements and opportunities for clients and consumers. This scenario puts us in a unique position to advise our clients, as our advice not only accommodates evolving technology, but also takes into account an uncertain regulatory landscape.

Scott McInnes commented: “This case was exciting as the evolving Payments regulatory landscape meant our advice to the client had to provide them with the tools to make the best commercial decisions, but also the flexibility to safeguard them against future legislation”.