Open Banking Global Market Opportunities and Strategies to 2033

This report describes and explains the open banking market and covers 2018-2023, termed the historic period, and 2023-2028, 2033F termed the forecast period. The report evaluates the market across each region and for the major economies within each region.

The global open banking market reached a value of nearly $24.78 billion in 2023, having grown at a compound annual growth rate (CAGR) of 33.3% since 2018. The market is expected to grow from $24.78 billion in 2023 to $77.45 billion in 2028 at a rate of 25.6%. The market is then expected to grow at a CAGR of 24% from 2028 and reach $227.01 billion in 2033.

Growth in the historic period resulted from the rise in the usage of online platforms, increasing demand for fast & real-time fund transfer, growth in younger population and increasing adoption of financial technology for payment. Factors that negatively affected growth in the historic period were stringent regulations.

Going forward, the rise of digital banking platforms, growing adoption of smartphones, increasing e-commerce and lower transaction costs will drive the growth. Factors that could hinder the growth of the open banking market in the future include security, reputational and dependency risk.

The open banking market is segmented by service type into transactional services, communicative and informative services. The transactional services market was the largest segment of the open banking market segmented by service type, accounting for 68.5% or $16.97 billion of the total in 2023. Going forward, the communicative and informative services segment is expected to be the fastest growing segment in the open banking market segmented by service type, at a CAGR of 26% during 2023-2028.

The open banking market is segmented by financial services into bank and capital markets, payments, digital currencies and value added services. The bank and capital markets market was the largest segment of the open banking market segmented by financial services, accounting for 45.1% or $11.16 billion of the total in 2023. Going forward, the payments segment is expected to be the fastest growing segment in the open banking market segmented by financial services, at a CAGR of 28.9% during 2023-2028.

The open banking market is segmented by deployment type into cloud, on-premises and hybrid. The on-premises market was the largest segment of the open banking market segmented by deployment type, accounting for 53.5% or $13.25 billion of the total in 2023. Going forward, the cloud segment is expected to be the fastest growing segment in the open banking market segmented by deployment type, at a CAGR of 30.6% during 2023-2028.

The open banking market is segmented by distribution channel into bank channels, app market, distributors and aggregators. The app market was the largest segment of the open banking market segmented by distribution channel, accounting for 41.2% or $10.22 billion of the total in 2023. Going forward, the app market segment is expected to be the fastest growing segment in the open banking market segmented by distribution channel, at a CAGR of 29.9% during 2023-2028.

Western Europe was the largest region in the open banking market, accounting for 26.9% or $ 6.67 billion of the total in 2023. It was followed by North America, Asia-Pacific and then the other regions. Going forward, the fastest-growing regions in the open banking market will be Africa and Asia-Pacific where growth will be at CAGRs of 30.7% and 28.7% respectively. These will be followed by North America and Eastern Europe where the markets are expected to grow at CAGRs of 28.3% and 26% respectively.

The global open banking market is fairly fragmented, with many players operating in the market. The top ten competitors in the market made up to 22.7% of the total market in 2022. Banco Bilbao Vizcaya Argentaria, S.A. was the largest competitor with a 4.2% share of the market, followed by Banco Santander S.A. with 3.8%, HSBC Holdings Plc with 3.1%, Crédit Agricole S.A. with 2.4%, Citigroup Inc with 2.4%, NatWest Group Plc with 2.2%, Capital One Financial Corporation with 2%, DBS Group Holdings Ltd with 1.3%, Lloyds Banking Group with 1% and Barclays PLC with 0.4%.

The top opportunities in the open banking market segmented by service type will arise in the transactional services segment, which will gain $35.65 billion of global annual sales by 2028. The top opportunities in the open banking market segmented by financial services will arise in the bank and capital markets segment, which will gain $22.79 billion of global annual sales by 2028. The top opportunities in the open banking market segmented by deployment type will arise in the on-premises segment, which will gain $21.25 billion of global annual sales by 2028. The top opportunities in the open banking market segmented by distribution channel will arise in the app market segment, which will gain $27.62 billion of global annual sales by 2028. The open banking market size will gain the most in the USA at $14.68 billion.

Market-trend-based strategies for the open banking market include focus on developing and introducing open banking payments solutions to gain a competitive edge in the market, focus on launching payment initiation service APIs for the market’s growth, focus on developing and introducing advanced payments solutions, like variable recurring payments, to sustain their position in the market, focus on continuously investing in the ongoing digitization of cash and treasury management services to meet the increasingly digital needs of global business banking clients by launching new products, focus on undertaking partnerships and investments to strengthen their position in the open banking market.

Player-adopted strategies in the open banking market include focuses on enhancing its business operations through strategic investments, focus on enhancing business capabilities through the launch of new products and focus on enhancing business operations through strategic collaborations and partnerships.

To take advantage of the opportunities, the analyst recommends the open banking companies to focus on open banking payments innovation for market leadership, focus on elevating open banking with variable recurring payments (vrps), focus on revolutionizing services with advanced digital platforms, focus on strategic partnerships and investments for market leadership, focus on accelerating growth through communicative and informative services, focus on payments and bank & capital market segments, focus on navigating growth through cloud solutions, expand in emerging markets, continue to focus on developed markets, focus on app and bank channels growth, provide competitively priced offerings, participate in trade shows and events, continue to use B2B promotions, focus on building credible narratives and focus on tailoring human-centric experiences.