I just want to easily pull bank/card transactions into my budget app, and the glacial pace of open banking really annoys me. The pace in Canada has been just as slow, although we have Interac for direct person to person transfers already so I'm not sure how much the issue of direct payments applies there.
It's really just f**ing ridiculous that some of the earliest and most important digital systems we have are allowed to wall in their data with no API access. Banks suck so goddamn hard and are allowed to operate without any real competition and don't innovate at all. They are the definition of regulatory capture.
At the time I was using ledger for personal accounting. Ledger is amazing and incredibly flexible. Writing the journals with detailed financial data is way too time consuming though.
I tried to write software to pull this data from the banks. Got in touch with the managers at my bank and everything, they even referred me to their devs. I just needed read only access to my own bank account.
I eventually discovered I needed permission from the goddamn central bank to do this.
I also tried to integrate with my government's electronic consumer receipt systems. The idea was I'd scan the receipt with my phone or laptop camera and it'd download the data and automatically generate a detailed ledger journal entry with individual postings and metadata for every product I purchased. This was going to save me so much time it's not even funny.
I discovered I had to create a corporation to even ask the government for API access to my own data.
"Open Banking" is just… not open at all. Misleading name.
Had similar idea - just to pull my own data, tag transactions, etc etc, and have a nice stats. Nope, it is so "open" that it's just impossible to pass for single-user idea. "Open Banking" just gives me opportunity to show in my Bank A part of data from Bank B.
> allowed to wall in their data with no API access
There's PSD2 in the EU (or Eurozone? Not sure actually). Basically forces banks to open common APIs to encourage interopability and competition. However, it's not aimed at users but rather at companies in fintech building applications.
Some banks (Bunq comes to mind) offer APIs to their customers for direct use, but most don't. The reason is obviously security. People still fall for phishing, people still give fake bank staff their access codes on the phone. Giving normal users a way to have API access to their bank account would be disastrous for many of those users.
Now, it would be nice if things like PSD2 were a little more accessible and transparent. Currently you need permission from an institution like The National Bank to gain access. It's expensive and bureaucratic.
It's a great idea, but it's been killed off by the small print that was lobbied into the requirements
Basically, banks force apps or users to require you fully revalidate user consent every 90 days. And it's quite an annoying process. That means any app or integration you want to build, requires 10 minutes of your time every 90 days or they stop working. It's killed many Fintech's.
It all works on paper, but is drafted into law by politicians who have no clue about technical challenges and user experience. So in the end, it works exactly as designed by the banks: it doesn't
It's for SEPA area BUT it's mandatory open only for PSPs/financial institutions cutting out end customers... Also most banks have a terribly limited support. Personally I use OpenBank APUs (PSD2/DSP2) for some banks (ironically via a Canadian operator, GoCardless) and well... generic accounts are supported, stocks are not, bank cards are not etc, most exports have very poor quality.
Long story short I can auto-import in Firefly III from EU banks only via a Canadian company and the quality of the process NOT due to GoCardless but due to local banks is terrible...
I am thinking if I am in the minorities or such practice isn't common across the world where I have many credit cards and bank accounts. I am willing to pay $5 dollars a month just for such services. A single places where it shows All my current accounts balance, auto pay all credit cards bills on payment date. Showing all my current credit card spendings this month, remaining ( next invoice ) and where they belongs to, mostly dinning.
I would have thought Apple Pay and Mobile Payment would pave the way for better Credit Card services, but right now most of them are glibbest on the statement. I dont remember which restaurant it is nor does it correctly show.
I basically want a central place for all my finance. Including discount on credit cards, savings, interest rate loan etc. And I am willing to pay a small fees for it.
> Banks suck so goddamn hard and are allowed to operate without any real competition and don't innovate at all.
It's not really the banks' fault. They're all stuck leasing expensive information systems from entrenched third-party technology shops. They don't have software development dollars and they are extremely risk averse, to a paranoid degree. Thank the regulatory environment for that (state and federal).
Companies like Moov.io are trying to crack open this space and provide the levels of integration we see in other industries.
Bitcoin does seem like a great store of value, but as far as I know transacting with it is still quite expensive, and obviously not accepted in most places. Watching the USD be devalued in real time while BTC or Gold maintain value does drive home its utility as a store of value for sure.
But I can't buy groceries or pay rent with it, so i don't see how it works for the usecase I was talking about above. There's lots of ways to convert back and forth but you pay fees on each conversion so it's not economical to use for payments.
No mention of how open banking works outside of the US, where (in the UK) bank transfers are basically instantaneous and free, and I can happily retrieve my payments list to my budgeting app.
> and I can happily retrieve my payments list to my budgeting app
Is this a UK thing? I've been searching for something like Mint/Quicken in the EU and haven't found anything worthwhile because there doesn't seem to be a standard for budgeting apps to connect to banks.
Open banking does that but it needs to be a provider.
Some banks let you download in formats that let you then import into something. I have imported a lot into Gnucash from a downloaded file but its not smooth or complete (narrative needed fixing).
Remember the Synapse/Yotta/Evolve collapse.[1] That is what happens when a fintech startup has authority to manipulate customer bank accounts
but is not financially strong enough to handle problems.
I would argue, the issue is that they had exclusive control over the customers bank accounts. I have no problem with fintech that integrates with existing accounts over the top.
The issue is with fintechs that are not really banks, so they keep your money in a "program bank" where you are not the direct customer. You can't go to the program bank and say Fintech XYZ went belly up and I want my money, because you are not the banks direct customer (even though in some cases your name is legally on the account for FDIC insurance reasons).
Open banking tech is way more about the former than the latter.
To be clear, the Synapse case is not clearly a financial strength issue in the sense that they took risks with customer funds, but rather an extremely serious record keeping/accounting/auditing one. Synapse was supposed to be nothing more than a "dumb pipe" between customers, fintechs, and underlying traditional bank accounts.
That's the problem with those things. Who's responsible for plumbing leaks?
A sizable fraction of what bank employees do involves error conditions and fraud. The happy path has been automated for decades. One of the big discoveries when PayPal started up was that they were not in the money transfer business. They were in the fraud prevention business.
The entire banking industry is the most backwards, outdated and barely functioning sector in the whole world. I have no clue how we have not yet collapsed the financial system via some hack or basic data loss.
As someone working in fintech (in Europe): I agree. People always say "well at least it's tested and works!" but fintech is pure bullshittery. We wrap shiny new apps over 30 year old legacy systems written in C++ and bank employees need to constantly correct data manually. I know from a bank that has only one employee that knows about the whole system and nobody knows what happens when they retire (is already aged >50). Generally, banks rely on a very small number of (overworked) people that prevent the whole system from collapsing and they will all retire in a few years. Neo-banks and Neo-broker have their own disadvantages (like bad support, etc.) but at least they are forward-thinking.
Everything is also constantly regulated to death (and not the good kind) and banks wait until the very last day (even when regulations were passed at EU-level 6 years (!!) ago) and you then need to rush implementing it in the last month.
After working there for a few years now it's hard to trust any bank. Better not think too hard about it...
> I have no clue how we have not yet collapsed the financial system via some hack or basic data loss.
Banks are pretty good at not losing data. They're also pretty good at layered security.
I mean there's fraud and theft on all levels, but collapse-level events don't come from "a hack or basic data loss". They come from political incompetence and large scale economic events.
Except for that day I logged into Barclays Bank (in the UK) and half the transactions were missing from the last several months of statements.
We're talking maybe 50 transactions just gone from the bank account ledger, which had long since been settled and previously downloaded (that's how I noticed).
To be fair to them, the transactions reappeared a few days later. But it took days, and had me quite worried.
We have many times. We've ruined lives and literally killed people over it, but we just accept this is how money works. We couldn't possibly consider changing The System because The System is perfect, all-knowing and benevolent. Trust in The System!
Also there's a bunch of really annoying and expensive processes for rich people to get their money back after an error, so they don't see any problem.
with all the self-custody crypto cards available right now I completely stopped using bank accounts. Can easily pull the data from the ledger and automate payments as I wish
> In the intervening years, that competition has arrived. The banks do not like it, and would prefer it if it went away.
This is the conclusion of most articles about such topics. The conclusion is that we need less "knuckle-raps". Instead, a crippling sledgehammer blow to both kneecaps followed by a warning that the next will be to the skull (of the company, to be clear) unless the banks entirely capitulate, accept a massive reduction in profits and executive pay, and fully open their entire systems.
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It's really just f**ing ridiculous that some of the earliest and most important digital systems we have are allowed to wall in their data with no API access. Banks suck so goddamn hard and are allowed to operate without any real competition and don't innovate at all. They are the definition of regulatory capture.
At the time I was using ledger for personal accounting. Ledger is amazing and incredibly flexible. Writing the journals with detailed financial data is way too time consuming though.
I tried to write software to pull this data from the banks. Got in touch with the managers at my bank and everything, they even referred me to their devs. I just needed read only access to my own bank account.
I eventually discovered I needed permission from the goddamn central bank to do this.
I also tried to integrate with my government's electronic consumer receipt systems. The idea was I'd scan the receipt with my phone or laptop camera and it'd download the data and automatically generate a detailed ledger journal entry with individual postings and metadata for every product I purchased. This was going to save me so much time it's not even funny.
I discovered I had to create a corporation to even ask the government for API access to my own data.
"Open Banking" is just… not open at all. Misleading name.
Had similar idea - just to pull my own data, tag transactions, etc etc, and have a nice stats. Nope, it is so "open" that it's just impossible to pass for single-user idea. "Open Banking" just gives me opportunity to show in my Bank A part of data from Bank B.
There's PSD2 in the EU (or Eurozone? Not sure actually). Basically forces banks to open common APIs to encourage interopability and competition. However, it's not aimed at users but rather at companies in fintech building applications.
Some banks (Bunq comes to mind) offer APIs to their customers for direct use, but most don't. The reason is obviously security. People still fall for phishing, people still give fake bank staff their access codes on the phone. Giving normal users a way to have API access to their bank account would be disastrous for many of those users.
Now, it would be nice if things like PSD2 were a little more accessible and transparent. Currently you need permission from an institution like The National Bank to gain access. It's expensive and bureaucratic.
Basically, banks force apps or users to require you fully revalidate user consent every 90 days. And it's quite an annoying process. That means any app or integration you want to build, requires 10 minutes of your time every 90 days or they stop working. It's killed many Fintech's.
It all works on paper, but is drafted into law by politicians who have no clue about technical challenges and user experience. So in the end, it works exactly as designed by the banks: it doesn't
Long story short I can auto-import in Firefly III from EU banks only via a Canadian company and the quality of the process NOT due to GoCardless but due to local banks is terrible...
That's why stablecoins are booming...
I would have thought Apple Pay and Mobile Payment would pave the way for better Credit Card services, but right now most of them are glibbest on the statement. I dont remember which restaurant it is nor does it correctly show.
I basically want a central place for all my finance. Including discount on credit cards, savings, interest rate loan etc. And I am willing to pay a small fees for it.
It's not really the banks' fault. They're all stuck leasing expensive information systems from entrenched third-party technology shops. They don't have software development dollars and they are extremely risk averse, to a paranoid degree. Thank the regulatory environment for that (state and federal).
Companies like Moov.io are trying to crack open this space and provide the levels of integration we see in other industries.
But it's really hard and slow.
Deleted Comment
But I can't buy groceries or pay rent with it, so i don't see how it works for the usecase I was talking about above. There's lots of ways to convert back and forth but you pay fees on each conversion so it's not economical to use for payments.
Do you treat your matrass like a bank? Maybe with the pidgin carrier protocol to do money transfers?
Dead Comment
Is this a UK thing? I've been searching for something like Mint/Quicken in the EU and haven't found anything worthwhile because there doesn't seem to be a standard for budgeting apps to connect to banks.
Not that it really is as open as many of us might like - the banks did a pretty good job of tying much of it up in red tape.
[1] https://developer.gocardless.com/bank-account-data/overview#...
I personally use Finanzguru (for the German market, it supports many banks).
Likely to be many others.
Some banks let you download in formats that let you then import into something. I have imported a lot into Gnucash from a downloaded file but its not smooth or complete (narrative needed fixing).
[1] https://apnews.com/article/synapse-evolve-bank-fintech-accou...
The issue is with fintechs that are not really banks, so they keep your money in a "program bank" where you are not the direct customer. You can't go to the program bank and say Fintech XYZ went belly up and I want my money, because you are not the banks direct customer (even though in some cases your name is legally on the account for FDIC insurance reasons).
Open banking tech is way more about the former than the latter.
A sizable fraction of what bank employees do involves error conditions and fraud. The happy path has been automated for decades. One of the big discoveries when PayPal started up was that they were not in the money transfer business. They were in the fraud prevention business.
Everything is also constantly regulated to death (and not the good kind) and banks wait until the very last day (even when regulations were passed at EU-level 6 years (!!) ago) and you then need to rush implementing it in the last month.
After working there for a few years now it's hard to trust any bank. Better not think too hard about it...
Sometimes not moving fast and not breaking things has its advantages.
Banks are pretty good at not losing data. They're also pretty good at layered security.
I mean there's fraud and theft on all levels, but collapse-level events don't come from "a hack or basic data loss". They come from political incompetence and large scale economic events.
Except for that day I logged into Barclays Bank (in the UK) and half the transactions were missing from the last several months of statements.
We're talking maybe 50 transactions just gone from the bank account ledger, which had long since been settled and previously downloaded (that's how I noticed).
To be fair to them, the transactions reappeared a few days later. But it took days, and had me quite worried.
you are confusing payment card issuers and processors with banks
Also there's a bunch of really annoying and expensive processes for rich people to get their money back after an error, so they don't see any problem.
its crazy and its here today
Dead Comment
This is the conclusion of most articles about such topics. The conclusion is that we need less "knuckle-raps". Instead, a crippling sledgehammer blow to both kneecaps followed by a warning that the next will be to the skull (of the company, to be clear) unless the banks entirely capitulate, accept a massive reduction in profits and executive pay, and fully open their entire systems.