MARKET OVERVIEW:
The global open banking market, valued at USD 30.0 billion in 2024, is primed for rapid expansion. Driven by fintech investments, regulatory mandates like PSD2 and open banking initiatives, rising consumer demand for personalized financial experiences, and innovations in API and digital banking technologies, the sector is set to surge to USD 127.7 billion by 2033.
STUDY ASSUMPTION YEARS
- BASE YEAR: 2024
- HISTORICAL YEAR: 2019–2024
- FORECAST YEAR: 2025–2033
OPEN BANKING MARKET KEY TAKEAWAYS
- The market reached USD 30.0 billion in 2024 and is forecast to hit USD 127.7 billion by 2033, growing at a 16.59 % CAGR.
- Europe leads regionally, propelled by PSD2, GDPR, and a thriving fintech ecosystem.
- Banking & capital markets dominate services, benefiting from regulatory push and tech advancements.
- On‑premises deployment holds the largest share due to security and control preferences.
- App markets are the top distribution channel, fueled by rising consumer demand for mobile financial solutions.
- Innovative adoption of AI, machine learning, and blockchain is reshaping personalization and trust in financial services.
MARKET GROWTH FACTORS
- Technological Advancements & API Integration
The rapid expansion of the open banking market is closely linked to exciting advancements in API technology. Thanks to secure and standardized APIs, traditional banks and fintech companies can now share data effortlessly. For example, more than 9,000 fintech startups across the EU are taking advantage of these integrations, which are driving innovation in services like budgeting apps, personalized lending, and investment platforms. These developments are breaking down barriers to entry, enabling quick partnerships, and enhancing cybersecurity, all of which boost consumer trust and promote global market growth.
- Regulatory Frameworks Driving Innovation
Regulations like Europe’s PSD2 (Payment Services Directive 2) and the UK Open Banking mandate have transformed the scene by requiring banks to make their APIs accessible to third-party providers. This shift has sparked a wave of collaboration, competition, and innovation focused on consumer needs. By 2021, nearly 2,500 third-party providers were registered in the EU, and by 2023, API calls in the UK had surpassed one billion. These regulations not only facilitate secure data sharing in line with GDPR but also establish a foundation for lasting market trust and ongoing growth.
- Rising Demand for Personalization & Digital Experiences
Modern consumers are increasingly looking for financial services that cater specifically to their needs. Open banking is paving the way for banks and fintech partners to offer tailored solutions like real-time spending insights, flexible loan terms, and AI-driven investment advice. With over 60% of European consumers preferring personalized services, providers can boost user engagement and loyalty by embracing these innovations. This trend not only enhances customer satisfaction but also creates new revenue opportunities and fosters the development of interconnected financial ecosystems.
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MARKET SEGMENTATION
By Services:
- Banking and Capital Markets: The largest share, driven by regulatory adoption and tech integration.
- Payments: Expanding mobile and cross-border payment services via APIs.
- Digital Currencies: Growing inclusion of crypto solutions in banking platforms.
- Value Added Services: Financial advice, analytics, budgeting, and more.
By Deployment:
- Cloud‑based: Scalable and flexible banking solutions.
- On‑premises: Preferred for control and compliance, dominating current share.
By Distribution Channel:
- Bank Channels: Traditional delivery via bank portals.
- App Markets: Leading segment, driven by mobile-first consumer behavior.
- Distributors: Third-party financial platforms and resellers.
- Aggregators: Platforms bundling multiple services and data sources.
Breakup by Region:
- North America (United States, Canada)
- Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, Others)
- Europe (Germany, France, United Kingdom, Italy, Spain, Russia, Others)
- Latin America (Brazil, Mexico, Others)
- Middle East and Africa
REGIONAL INSIGHTS
Europe is leading the charge in the open banking arena, thanks to strong frameworks like PSD2 and GDPR. With nearly 2,500 registered providers and a high rate of fintech adoption, Europe has become a hotbed of innovation. Its focus on consumer needs and clear regulations build trust and support rapid growth in the region, solidifying its position as a leader in global open banking.
RECENT DEVELOPMENTS & NEWS
Recent innovations are generating exciting momentum. In July 2023, Fintonic introduced OpenInsights, an analytics platform that leverages open-banking data to improve enterprise decision-making, enhance customer experiences, and provide strategic insights. In October 2022, GoCardless teamed up with Crowdz to integrate open banking into SME financing, allowing for instant and secure cross-border payments. These advancements highlight the market’s focus on data-driven analytics and seamless payment solutions.
KEY PLAYERS
- Banco Bilbao Vizcaya Argentaria S.A.
- Clarity Group Inc.
- Credit Agricole (SAS Rue La Boétie)
- Finastra (Misys International Limited)
- Finleap connect
- Jack Henry & Associates Inc
- Mambu
- NCR Corporation
- Nordigen Solution
- Revolut Ltd
- Riskonnect Inc.
- Societe Generale
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