Small business owners still suspicious of open banking – survey
It is failing to have an impact two years after it was introduced.
Most owners of small businesses are wary about sharing their data electronically, holding back the rollout of open banking which makes it easier to manage their money.
Fewer than one in seven business owners questioned by the Federation of Small Businesses (FSB) said they were sharing the details of their business bank accounts with third parties.
It means that most businesses are not getting the benefits of open banking, which puts invoice, cash flow, payroll, utilities and tax data all in the same place, the FSB said.
This was always going to be a hard sell – one moment we business owners are told to do all we can to protect sensitive data, the next we’re being told it’s safe to dish it out Mike Cherry, FSB
“We’re two years on from the introduction of open banking but very few small firms have reaped any benefit from it,” said FSB chairman Mike Cherry.
He added: “The financial crash casts a long shadow. A lot of small business owners still don’t trust lenders to do the right thing.”
The survey of 1,000 business owners found that two-thirds of smaller firms would not consider sharing their banking data electronically with other financial service providers.
Four in 10 of these think that it is unsafe, while 37% say they are “unsure of the benefits” it could bring. Most say they are “wary” of sharing the information.
“This was always going to be a hard sell – one moment we business owners are told to do all we can to protect sensitive data, the next we’re being told it’s safe to dish it out,” Mr Cherry said.
He called on the Government and regulators to raise awareness and shed light on who is responsible for cybersecurity breaches and protecting small businesses.
“We need to see a concerted effort from the Government, banks and the FCA to ensure that open banking application programming interfaces are absolutely watertight, and small business owners are fully aware of the benefits of using them,” Mr Cherry said.