Open banking explained in one line: it lets you tell your bank to share your account data, or make a payment, through a regulated third party you choose, using secure connections instead of passwords. This guide explains how open banking works, how the rules differ in the UK, the UAE and Singapore, and what the differences mean for founders, investors and banks.
The three markets started from very different places. The UK ordered its largest banks to open up, the UAE has written open finance into central bank regulation, and Singapore has relied on guidance, industry standards and shared public infrastructure. Understanding those choices helps you decide where to build, partner or invest.
We run FinNext, a one-day fintech summit with editions in Dubai, London and Singapore, so open banking and open finance come up in conversations at every edition.
In this article
What is open banking?
Open banking is a set of rules and technical standards that let customers share data held by their bank with other regulated firms, and let those firms start payments from the customer’s account, always with the customer’s consent. The connection runs through an application programming interface (API), a secure channel that lets two computer systems exchange information in an agreed format.
In the UK, the two core services are defined in payments regulation. The Financial Conduct Authority (FCA) describes an account information service as an online service that provides consolidated information on a user’s payment accounts, and a payment initiation service as one that initiates a payment order at the request of the user from an account held elsewhere. Firms offering only account information can register with the FCA, while payment initiation providers must be authorised.
Open banking and open finance: the difference
Open banking usually covers current accounts and payments. Open finance extends the same idea to savings, loans, mortgages, insurance, pensions and investments, so a customer can share a fuller picture of their financial life. The UAE has gone straight to open finance, while the UK started with banking and is working towards a wider model.
- Account information: budgeting apps, accounting software and lenders read transaction data to give advice, reconcile books or assess affordability.
- Payment initiation: a merchant or app starts a bank transfer directly from the customer’s account, with no card involved.
- Open finance: the same consent-based sharing applied to insurance, investments, pensions and other financial products.
How open banking works, step by step
The details vary between markets, but a typical open banking journey follows the same pattern, whether the customer is checking their balance in a budgeting app or paying for something online.
- The customer chooses a service. For example, an accounting app that wants to import business bank transactions.
- The provider asks for consent. The app explains what data it needs, for what purpose and for how long.
- The customer is sent to their bank. They log in with the bank’s own security, such as a banking app or biometrics, and confirm the request. The provider never sees their banking password.
- The bank shares access through an API. The provider receives the agreed data, or the bank carries out the agreed payment.
- The customer stays in control. Consent can usually be reviewed and withdrawn from the provider or the bank.
This model replaced an older practice called screen scraping, in which apps stored customers’ login details and read their online banking pages. Standard APIs are faster, more reliable and safer for everyone involved, which is why regulators have pushed the market towards them.
Open banking in the UK: from a competition remedy to national infrastructure
How it started
UK open banking began as a competition remedy. After its market investigation into retail banking, the Competition and Markets Authority (CMA) made the Retail Banking Market Investigation Order 2017, which required the nine largest retail banks, known as the CMA9, to set up and fund the Open Banking Implementation Entity and share customer data through secure common standards, according to the CMA.
In January 2023 the CMA said six of those banks, Barclays, HSBC, Lloyds, Nationwide, NatWest and Santander, had implemented all of the requirements in the Open Banking Roadmap, and that the roadmap was substantially complete. At that point the UK had more than six million active open banking users.
The numbers today
Usage has grown steadily since. In a September 2026 update, Open Banking Limited said monthly open banking payments passed 40 million for the first time in May 2026, and cumulative payments passed one billion in June 2026. Cumulative API calls passed 100 billion in the same month, with a record 2.94 billion calls in July 2026.
Around 80% of API calls come from account information services, the data-sharing side of open banking. Payment volumes, however, are growing faster: Open Banking Limited reported a 45% year-on-year rise in payments for the year to July 2026.
What comes next: variable recurring payments and smart data
The next stage is about payments. Variable recurring payments (VRPs) let a customer give a trusted provider permission to make a series of payments within agreed limits. In December 2025 the FCA and the Payment Systems Regulator said VRPs made up 16% of open banking transactions, that 31 firms had set up the UK Payments Initiative to deliver commercial VRPs, and that the first phase would cover utilities, financial services and government payments, as summarised by A&O Shearman.
In a January 2026 letter to the CMA, the FCA and the PSR described UK Payments Initiative Ltd as a new organisation set up to own and operate a multilateral framework for commercial VRPs. Separately, the Data (Use and Access) Act 2025, which received Royal Assent on 19 June 2025, creates a framework for smart data schemes in other sectors, and law firm CMS notes that the government sees open banking as the model for them.
Open banking in the UAE: a mandated open finance model
The Open Finance Regulation
The UAE chose a broader, regulator-led approach. The Central Bank of the UAE (CBUAE) mandated open finance in 2023, and an updated regulation came into force on 10 July 2025, according to law firm Pinsent Masons. It covers banking, insurance and payments, including accounts, loans, mortgages, insurance, stored value facilities, wallets and investment products.
Participation is mandatory for CBUAE-licensed firms that provide banking or financial services, from banks and finance companies to payment service providers, exchange houses and insurers. Third-party providers need a CBUAE licence. The regulation applies onshore; the DIFC and ADGM financial free zones have their own regulators.
Al Tareq and Nebras
Unlike the UK, where each bank builds and runs its own APIs to common standards, the UAE uses central infrastructure. Nebras Open Finance, a CBUAE subsidiary, operates the API hub and common services and sets the pricing model. Al Tareq is the customer-facing layer, with a standard consent flow, central authentication and account-to-account payment initiation.
- Consent must be explicit, informed and securely recorded, in line with the UAE’s personal data protection law.
- Data may be used only for the purpose the customer authorised.
- Data scraping is prohibited, and providers may not resell data received from other participants.
Going live
The framework is being phased in. In December 2025 Commercial Bank of Dubai said it had become the first UAE bank to fully activate open finance for live use under Al Tareq, with licensed providers Pay10 and Lean Technologies connected through Nebras, and its retail customers able to share data and start payments, according to the bank’s announcement.
Open banking in Singapore: a market-led approach
Guidance rather than a mandate
Singapore has not ordered banks to open up in the way the UK and the UAE have. The Monetary Authority of Singapore (MAS) has encouraged adoption through industry engagement, starting with its Finance-as-a-Service API Playbook in 2016, which gave banks recommended standards for building and publishing APIs, according to open finance tracker Fiskil. As a result, the APIs on offer and the terms for using them depend largely on each bank’s commercial choices.
SGFinDex: shared public infrastructure
Singapore’s best-known open finance project is public infrastructure. MAS and the Smart Nation and Digital Government Group launched the Singapore Financial Data Exchange (SGFinDex) on 7 December 2020. It lets individuals pull together information from banks and government agencies, using Singpass, the national digital identity, and only with their explicit consent.
At launch, seven banks took part: DBS, OCBC, UOB, Citibank, HSBC, Maybank and Standard Chartered. Data covered deposits, credit cards, loans and investments from banks, plus CPF balances and HDB loans from government agencies.
By November 2021 SGFinDex had more than 150,000 unique users and investment holdings at The Central Depository had been added, MAS said. For more on how the city-state regulates and supports fintech, read our guide to fintech in Singapore.
Open banking explained side by side: UK, UAE and Singapore
The three markets share the same building blocks of consent, APIs and regulated providers, but they differ on who drives the change and how far it reaches.
| UK | UAE | Singapore | |
|---|---|---|---|
| Approach | Mandated for the largest banks by a competition order | Mandated by the central bank for licensed firms | Voluntary, guided by MAS |
| Main legal basis | CMA Retail Banking Market Investigation Order 2017 and payment services rules | CBUAE Open Finance Regulation (updated version in force from 10 July 2025) | MAS guidance and industry standards |
| Scope | Payment accounts, moving towards wider open finance | Banking, insurance, payments and investments | Bank APIs, plus SGFinDex for individuals |
| Infrastructure | Each bank runs its own APIs to common standards | Central API hub run by Nebras, with Al Tareq as the customer layer | Bank APIs plus SGFinDex, using Singpass |
| Signature feature | Payments growth and variable recurring payments | Single national platform for open finance | Public data exchange for financial planning |
For a fintech, the practical difference is the integration model. In the UK you connect to many banks, usually through an aggregator. In the UAE you connect once to a central platform after obtaining a licence. In Singapore you negotiate access bank by bank.
What open banking means for founders, investors and banks
- Founders: check early whether your product needs a licence or registration, and which one. Account information and payment initiation are regulated activities in the UK, and third-party providers need a CBUAE licence in the UAE.
- Founders building payments: account-to-account payments can cut card costs for merchants, but customer experience decides adoption. Test the bank journey on real devices before you launch.
- Investors: ask how a company accesses data in each market, what that access costs, and what happens if a regulator changes the rules. Dependence on one aggregator or one bank is a risk to price in.
- Banks: open banking turns APIs into a product. Banks that offer reliable APIs, clear pricing and good developer support become partners for fintechs rather than competitors.
Across all three markets, trust is the deciding factor. Customers share data when they understand what they are agreeing to and can see the benefit, so clear consent screens matter as much as the technology behind them.
Facts checked on 31 October 2026. This article is general information, not legal or financial advice. Rules change, so check the regulator’s current requirements before you launch, partner or invest.
Open banking: frequently asked questions
What is open banking in simple terms?
Open banking lets you share your bank account data, or make payments from your account, through a regulated third-party provider you choose. The provider connects to your bank through a secure API, and you give consent at your bank without sharing your password.
Is open banking safe?
Open banking providers must be registered or authorised by the regulator, and customers confirm access with their own bank’s security. You can usually review and withdraw consent at any time. As with any financial service, only use providers you recognise and check what you are agreeing to share.
What is the difference between open banking and open finance?
Open banking usually covers current accounts and payments. Open finance applies the same consent-based data sharing to savings, loans, insurance, pensions and investments. The UAE’s framework is open finance from the start, while the UK began with banking.
Does Singapore have mandatory open banking?
No. MAS has encouraged banks to publish APIs through guidance and industry standards rather than a mandate. Singapore also runs SGFinDex, a public data exchange launched in December 2020 that lets individuals combine financial information from banks and government agencies with their consent.
Who runs open finance in the UAE?
The Central Bank of the UAE regulates it. Nebras Open Finance, a CBUAE subsidiary, operates the central API hub, and Al Tareq is the customer-facing layer that handles consent, authentication and payment initiation.
Join us at FinNext 2027
Open banking and open finance are reshaping how money moves in Dubai, London and Singapore. Get your pass for FinNext 2027, see the three 2027 editions in Dubai on 7 October, London on 13 October and Singapore on 24 November, or read our guide to fintech in Dubai.