The founder and CEO of the MENA region’s first and largest regulated open banking platform is confident the technology will revolutionise the industry, with a mobile application taking on the role of the traditional financial advisor.
Open banking is the sharing of financial information electronically and securely, with the consent of the customer.
Abdulla Almoayed, who is the driving force behind Tarabut Gateway, told Arabian Business: “With open banking, any mobile banking app that is out there and is licensed can become your financial advisor.
“If I was a financial advisor and I called someone up personally on a Thursday morning and said, you’ve got $10,000 sitting in your bank account, I’ve got a beautiful fixed deposit that’s suitable for you’d probably tell me to get lost and that I shouldn’t be looking at your bank account.
Abdulla Almoayed, founder and CEO of Tarabut Gateway.
“But if you get a technology; if you get a push notification or an SMS message of some sort and it’s not that intrusive, you are likely to opt in after a while.”
Through an Open Banking API, or application programming interface, it allows third-party financial services providers to access financial data and develop new apps and services.
Almoayed, who has more than 15 years of investment experience across various sectors, explained: “If you think of the early days when Deliveroo and Hungry House and Talabat and all of these delivery apps came about, it was ultimately to connect the customers to the restaurants. The kitchens remained kitchens, but it completely democratised the system where customers don’t really care what the restaurant looks like on the inside, they look at the application and they get their food delivered to them based on the packaging they put together.
Airbnb did it for the hospitality sector; Careem and Uber did it for the logistics sector; Hungry House and Deliveroo did it to the F&B, but pretty much the financial services is still the financial services as we knew it 20 years ago.”
He insisted it is 100 percent secure, saying: “You have a source of data that is extremely valuable and personalised, but that requires tech companies to come and plug into them, extract that data, clean it up and present it to you in a more easier to digest manner. That is what open banking is.
“The regulator defines the security frameworks for those integrations and the data mobility to happen.
“Ultimately, the new technologies are Public Key Identification, which is your biometrics, which is not something that can be stolen. The way you unlock your iPhone or your android, is predominantly the way you authenticate everything that’s out there.
Open banking uses the most advanced, secure data mobility that’s out there. So when your data moves from A to B it is technically impossible for people to hack into that.”
Tarabut Gateway was founded in 2017 and has been backed to the tune of around $10 million, with a further round of fundraising planned to take place in December.
“We expect it to be just as exciting,” said Almoayed. “We’re bringing in some blue chip investors to really grow out and start looking broader outside of the GCC as well.”
After starting operations in Bahrain, the company now has offices in the UK, Kuwait and in Beirut. Tarabut Gateway, which is already a trusted open banking partner connected to several retail banks, recently opened two new offices at Abu Dhabi’s global tech ecosystem, Hub71 and Dubai’s DIFC FinTech Hive, where they are looking to employ a further 25 members of staff, with further plans to expand into Saudi Arabia.
“We do believe that it’s a pretty exciting start that I think will really leapfrog ahead of other jurisdictions if it’s done right,” said Almoayed.
“If you look at the customer experience gap today, how you feel when you deal with your Snapchat, your Instagram or LinkedIn, whatever it is, versus dealing with your bank. It’s that customer experience gap that we’re trying to fill.”
Five reasons why open banking is gaining in popularity
- It can increase financial innovation and collaboration between banks and fintech entrepreneurs
- Regulated open-banking offers potential improvements for security
- Enriched data helps financial institutions tailor their products and services, enhancing the customer experience
- Open banking gives customers more control of their own data and who it is shared with
- Customers are better able to control and manage their finances in one place
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