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Open banking: Opening up the ‘walled gardens’
This paper explores the reasons for differences in open banking systems around the world in order to identify the ideal conditions for open banking. Following an examination of different approaches to open banking, the paper identifies six parameters that are essential for success, and discusses how to optimise these based on the Turkish experience. The findings have important implications for regulators of open banking initiatives. First, the active involvement of the regulator is crucial, especially during the early stages of implementation. More than simply providing the legal framework for open banking, regulators need to participate actively in the design and implementation of such systems, providing guidance for application programming interface standards and efficient infrastructures. Secondly, it is essential to build and maintain a shared platform with standardised infrastructure to foster fast adoption. Finally, the development of an instant payment system is critical to unlocking the full potential of open banking.
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Baran Aytaş is Deputy General Manager of Digital Payment Solutions at the Interbank Card Center in Turkey. He also represents the Central Bank of the Republic of Turkey as a member of the Committee on Payments and Market Infrastructures’ Future of Payments Working Group. He graduated from İ zmir Institute of Technology with a bachelor’s degree in computer engineering, and received his master’s degree in finance from Özyeğin University.
Serdar Murat Öztaner is Deputy Executive Director of Payment Systems and Financial Technologies at the Central Bank of the Republic of Turkey, where he participates in many research studies and large-scale payment systems projects. His bachelor’s and master’s degrees in computer engineering were earned at Middle East Technical University, as was his PhD in informatics.
Emrah Şener is Deputy Governor of the Central Bank of the Republic of Turkey, where he is responsible for the Payment Systems and Financial Technologies Department and the Financial Innovation Department. He also serves on the advisory board of the World Economic Forum’s Digital Payment Group. Dr Şener has a bachelor’s degree in business administration from Boğaziçi University, a master’s degree in economics and finance from London School of Economics and a PhD in mathematical finance from Imperial College London.