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Open Banking

Open Banking: UK SMEs have their say

John Hallsworth

John Hallsworth

John Hallsworth is a Partner at KPMG in the UK and the Open Banking Lead. John has been with the firm for six years and is a member of the UK Management Consulting Executive. John has 23 years of experience in consulting and professional advisory and has led large scale operational transformation programmes in banking organisations, covering structural change, customer transformation, merger integration and separation, cost reduction and regulatory change.

Open Banking spells disruption for banking providers that serve small and medium-sized enterprises (SMEs).

In August 2018, KPMG asked 1,000 SMEs for their views on Open Banking, testing their willingness to share data with a third-party under 13 different scenarios. What we found is that opinion is polarised and UK SMEs fall under three distinct types of customers, each with different appetites for Open Banking. In this report, we explore these customer types and identify the strategies most likely to persuade them to adapt, pay for, or switch supplier to access Open Banking services.

Competition for a share of the SME banking market will only intensify. As financial services firms deliver on the value promised in their Open Banking propositions, KPMG fully expects SME uptake to increase. It is down to financial services providers to identify and implement the right tactics and business models to cater to these different customer groups and to deliver the services, products and assurances that each needs.

Open banking isn’t for everyone yet… but it could be

Global sharing
  • Up to a half of SMEs might engage in Open Banking with trusted financial services providers
  • 25 percent will not share data with other financial providers, under any circumstance

Do you know your SME?

Limited appetite for Open Banking

42%Steady conservative

Limited appetite for Open Banking: The ‘steady conservative’ makes up 42 percent of respondents. They are typically low-growth, small and simple businesses

Some appetite for Open Banking

28%Moderate may-be

Some appetite for Open Banking: The ‘moderate may-be’ accounts for 28 percent of respondents. These are relatively low-growth, mid-sized businesses

Good appetite for Open Banking

30%Open for business

Good appetite for Open Banking: 30 percent are ‘open for business’. These high-growth, sophisticated and larger businesses, typically in manufacturing, technology, media and telecoms (TMT) or financial services, are likely to adopt or pay for Open Banking

Trust matters

1st Building

High street banks, followed by building societies, are most trusted by SMEs and best placed to deliver Open Banking

Thumbs down

New entrants and starts-ups are least trusted, indicating a hard task ahead

Group of people

Just one in seven SMEs is willing to give a third-party access to its data.

What services would SMEs pay/ switch for

will pay to make and receive payments to/from suppliers and customers more easily and quickly

24%
25%

will pay or switch provider for a dashboard of all business finance accounts, loans, savings, assets, etc.

25%

would switch providers for fast and easy payments

22%