Open Banking: Account Information Services

Account Information Services are perhaps the most visible current application of the advances made by Open Banking. Partnerships between brands, Account Information Service Providers (AISPs) and financial institutions have enabled a new wave of tools that help businesses and consumers take control of their financial data, and allow firms to provide world-class user experiences.

So what are Account Information Services, and how are they used?

What are Account Information Services?

Account Information Services are an Open Banking-enabled tool intended to provide better visibility of financial information. In an Account Information Services relationship, the user (whether a consumer or a business) authorises an Account Information Service Provider (AISP) to access information from their bank account. AISPs can see things like account balance and transaction history.

AISPs are at the heart of the Open Banking landscape, and many of the first wave of Open Banking-enabled products and services rely entirely on Account Information Services. They have strong support in law, with all of the UK’s major banks legally required to accede to any such request from an AISP.

What are the benefits of Account Information Services?

Account Information Services provide benefits for both businesses and consumers. Both now have access to new tools that enable them to get a better understanding of their financial position. For example, consumers may use one of a number of popular budgeting apps to see their account balances and to avoid cashflow hurdles.

Account Information Services also enable better application, verification, and onboarding processes, meaning smoother experiences for customers and better risk management for providers.

More broadly, Account Information Services are emblematic of Open Banking’s potential to broaden access to financial data. Before the advent of Open Banking, data was monopolised and siloed by the major financial institutions. This is now changing, and consumers are being given more control over the data they generate, with the intention that both consumers and industry can make better informed financial decisions.

What are some potential Account Information Services use cases?

Businesses might use products with Account Information Services integrated within them. For example, you might use an AISP to create a single financial dashboard providing an overview of all of your account positions in one place.

But your business might also choose to use an AISP to build better experiences for your own customers, or to enable you to make better decisions. For example, lenders may be able to use Account Information Services as an important new data stream when underwriting credit. Applicants can quickly and easily grant the lender access to their financial history, and this trove of information can be used to augment traditional credit searches and other existing methods.

In the coming years, both consumers and businesses will become as comfortable with Open Banking Account Information Services as they are with, for example, Google’s single sign-on tool. Applying for financial products will involve Account Information Services as a matter of course - although, obviously, consumers will know it not by this name but as part of the brand with which they are dealing.

Are Account Information Services the only Open Banking-enabled integration?

No. Account Information Service Providers (AISPs) are contrasted with Payment Initiation Service Providers (PISPs) as the two main third-party provider groups within the Open Banking ecosystem. While AISPs are authorised to view and aggregate account information, PISPs are authorised by users to initiate payments from the user’s nominated bank accounts. Some AISPs are also PISPs, but there are also many providers specialising in one or the other. Sometimes, AISPs are referred to as having ‘read-only’ access to accounts, while PISPs have ‘read-write’ access.

How do I integrate Account Information Services into my business?

If your business wants to enjoy the benefits of Account Information Services, they are best delivered through a Banking-as-a-Service platform. The BaaS platform model allows businesses to access an entire ecosystem of banking and payments services through a single API or web interface. OpenPayd, a leading BaaS platform, enables businesses to ‘plug into’ the financial infrastructure that they need, choosing from tools such as account management, FX provision, acquiring, and of course Account Information Services. These are delivered in a modular way, meaning that you can build the bespoke solution that you require. And, crucially, they integrate with your existing systems quickly and easily through a developer-first API and sandbox provision.

If you’re ready to integrate Account Information Services, other Open Banking processes, or indeed any other banking or payments solution, get in touch with OpenPayd today.