UK businesses back Open Banking but trust concerns grow

Research published by Payit by NatWest shows that 47% of UK businesses surveyed now use Open Banking, with trust in providers becoming a central concern as adoption rises.

The survey of 1,401 respondents found that 94% of businesses are likely to trial Open Banking as a payment method in the next 12 months. That marks a shift from the previous year, when lack of understanding was still a notable barrier and 28% said they had not adopted Open Banking because they did not understand it.

As uptake increases, businesses are focusing more closely on oversight and security. Some 93% said it is very or extremely important for Open Banking providers to be subject to the same regulatory requirements and oversight as banks.

Security also featured strongly among the factors that would encourage further adoption. Around 34% said increased security and fraud prevention would make them more likely to adopt Open Banking, while 27% said they would be encouraged if a well-known financial institution offered Open Banking services.

Payment delays

The report also highlights wider dissatisfaction with current payment systems. Nearly six in 10 businesses surveyed, or 59%, said their existing payment processes lead to late payments.

More than half, 55%, said those processes are not efficiently integrated with existing infrastructure. The same proportion said customer payments are too slow, compared with 49% in the earlier study who said payment processing was not fast enough.

According to the data, those delays have knock-on effects beyond treasury operations. Among businesses experiencing late-payment issues, 23% said this increases operational costs, 22% said it affects customer satisfaction and retention, and 20% said it limits growth potential.

The findings suggest payment friction is affecting cash flow management, day-to-day administration and broader commercial performance. They also indicate that businesses want payment systems that fit more smoothly into existing processes.

Trust focus

The emphasis on trust comes as Open Banking moves from a relatively unfamiliar option to a more established part of the payments market. For businesses considering wider use of the model, confidence in the provider appears to matter alongside speed and simplicity.

James Hodgson, Chief Executive Officer of Payit by NatWest, said: "Businesses are increasingly open to new ways of making and receiving payments, but the experience needs to be faster, simpler and more secure. Just as importantly, businesses want confidence that the providers they work with are held to the right standards.

"As Open Banking becomes more established, building trust will be critical to its continued adoption. Providers have an opportunity to work closely with banks and regulators, demonstrate robust security and give businesses confidence that innovation is being delivered alongside the right protections."

Charlotte Crosswell, Former Chair and Trustee of Open Banking Ltd, said: "Open Banking is entering a new phase, and as adoption continues to grow, building and maintaining trust will be critical. Businesses and their customers need confidence that the providers they use can deliver secure, reliable services, and that the right customer protections are in place. Without this trust, the full potential of Open Banking will be difficult to realise.

"The opportunity now is to turn growing awareness and adoption into lasting value for businesses and their customers. Building trust must remain at the heart of this next phase - through continued innovation, strong customer protection and a focus on making payments simpler, more secure and more efficient. These will be key to giving businesses and consumers the confidence to embrace Open Banking and unlocking its full potential in the UK."

The research was conducted by Censuswide across two waves and covered 1,401 UK respondents, including treasurers, Heads of Payments, Heads of Strategy and other senior financial decision-makers across sectors including professional services, financial services, education and transport.