SYDNEY, Sibos 2018 - Banks aspiring to stay relevant to their clients need to leverage on their data. That’s according to Eli Rosner, chief product and technology officer at Finastra, who believes that banks are not making full use of the opportunity to understand their customer base.

“The brand loyalty of banks is starting to fade out, especially with the young generation who don’t know what a bank is and look at it as a banking service,” he says during an interview with The Asset at the sidelines of Sibos 2018 Sydney.

A combination of API (application programming interface) connectivity and cloud computing is something that Rosner recommends in breaking down the barriers around data usage.

“APIs are just streamlining the communications between different programs, it removes the volatility between various software,” he explains. “The cloud on the other hand is giving you virtually a location where all the data is stored in one place with virtually unlimited computing power. They are both enabling technologies to work together with a bank.”

This has definitely been the case for several institutions that have been open in sharing data with financial technology companies. For example, Citi has been vocal about its partnerships with the likes of Spotify and Airbnb where customers can pay via points. Standard Chartered along with a number of banks using APIs have been able to connect into Ripple’s system to allow for cross-border payments.

Financial regulation also has an important role to play in promoting better data sharing between different institutions. The PSD2 (Payment Services Directive) in the European Union (EU), for example, now requires banks to share information to qualified non-bank payments providers. In Asia opening bank regulation is being developed, with the Hong Kong Monetary Authority this summer releasing a framework on open API usage for the banking sector.

While the move towards sharing data is providing customers with seamless banking experiences, there is still, however, the constant risk of ensuring that data is secured. With the recent spate of hacking centered around social media giant Facebook, markets still fear sharing data with entities outside of the bank.