How Superannuation Can Benefit from Open Banking

Open Banking has revolutionised the financial sector by providing greater transparency and accessibility to financial data. For superannuation funds, leveraging open banking can significantly enhance operations, improve customer experiences, and offer innovative services. Here’s how superannuation can benefit from the adoption of open banking.

Understanding Open Banking

What is Open Banking?

Open Banking involves the process where banks and financial institutions share their data with third-party providers through secure APIs (Application Programming Interfaces). This allows authorised entities to access customers' financial data, such as transaction histories and account details, with their consent. This system aims to foster competition and innovation by giving consumers more control over their financial information (SMH).

How Does Open Banking Work?

Open Banking works by allowing regulated providers to access and use data from banks and other financial institutions. This data is typically shared through APIs that provide a secure and efficient means of transferring information. The data sharing is governed by strict regulations to ensure privacy and security (SuperConcepts).

Benefits of Open Banking for Superannuation

1. Enhanced Customer Experience

Open Banking enables superannuation funds to offer a more personalised and seamless experience to their members. By accessing real-time financial data, funds can provide tailored advice, better investment recommendations, and personalised communication. This can lead to increased member engagement and satisfaction (GoCardless).

2. Improved Data Accuracy and Efficiency

With open banking, superannuation funds can access accurate and up-to-date financial information directly from members’ bank accounts. This reduces the likelihood of errors associated with manual data entry and ensures that the data used for investment decisions and reporting is precise. This accuracy improves operational efficiency and reduces administrative overhead (LinkedIn).

3. Streamlined Onboarding and Administration

Open Banking facilitates automated onboarding processes, allowing superannuation funds to verify member information and process applications more efficiently. This not only speeds up the onboarding process but also helps in reducing drop-off rates and improving overall administrative efficiency. Automated data integration from various financial sources streamlines management and reduces manual workloads (SMH).

4. Enhanced Fraud Detection and Risk Management

The ability to access real-time transactional data through open banking helps superannuation funds in identifying and mitigating fraudulent activities more effectively. By analysing transaction patterns and behaviours, funds can detect anomalies and suspicious activities early, enhancing their fraud detection capabilities and overall risk management strategies (GoCardless).

5. Innovative Financial Products and Services

Open Banking opens the door to innovative financial products and services tailored to superannuation members' needs. With access to comprehensive financial data, superannuation funds can develop new solutions such as integrated financial planning tools, advanced retirement calculators, and custom investment strategies that cater to the diverse needs of their members (SuperConcepts).

Integrating Fiskil to Enhance Superannuation Services

To fully leverage the benefits of open banking, superannuation funds can integrate with Fiskil. Fiskil provides a seamless connection to real-time banking and energy data, enhancing your superannuation services by offering precise and actionable insights.

Fiskil connects your product with open finance, allowing easy access to real-time banking and energy data. This integration elevates customer experience by providing up-to-date financial information and streamlining processes.

How Fiskil Enhances Superannuation

Identity Verification: Verify account ownership and identity details directly from members' bank accounts.
Automated Onboarding: Reduce drop-off rates and expedite the onboarding process by automatically completing applications and forms.
Fraud Detection: Utilise transactional data to detect and prevent fraudulent activities.
Personal Finances: Turn banking data into valuable insights for budgeting, forecasting, and savings.

By integrating Fiskil, superannuation funds can benefit from pre-built compliance solutions, a unified API, and data enrichment services. These features cut development time, improve speed to market, and lower IT project delivery risks.

Conclusion

Open Banking presents significant opportunities for superannuation funds to enhance their operations, improve member experiences, and innovate their service offerings. By integrating solutions like Fiskil, funds can maximise these benefits, streamline their processes, and stay ahead in a competitive market.