Mastercard Introduced an Open Banking Solution for Account Opening

Innovations in finance and payments continue to revolutionize the experiences of consumers and fintechs alike. According to a recent survey, a staggering 78% of adults in the U.S. prefer to bank through mobile apps or websites, highlighting the increasing shift towards digital banking. This trend is projected to drive digital transaction volumes to nearly $15 trillion by 2027. However, with this growth comes the challenge of combating sophisticated fraud, including account takeover and synthetic identity fraud, which can significantly impact consumers and businesses.

Addressing the need for secure and transparent financial services, Mastercard has unveiled its enhanced Open Banking for Account Opening solution. This groundbreaking fintech solution combines account owner verification with identity insights into a single API, enabling businesses to meet the evolving needs of their customers. By integrating these features, Mastercard aims to instill confidence in both consumers and businesses within their digital ecosystem.

Chris Reid, EVP, Identity Solutions at Mastercard, emphasized the company’s commitment to trust and fostering the digital economy. «At Mastercard, trust is our business. Our digital identity and open banking networks instill confidence on both sides of an interaction. By securing our online ecosystem, we are delivering on our promise to bring more people and businesses into the digital economy,» Reid stated.

Mastercard Open Banking for Account Opening offers real-time verification of a consumer’s account ownership and identity. Additionally, it simplifies the account opening process by prefilling account and routing data, minimizing errors. This streamlined approach provides a faster, safer, and more convenient way for the majority of consumers who are expected to utilize digital payments this year. For financial institutions and fintechs this solution offers a unified and straightforward method to verify individuals opening new accounts while reducing friction and the risk of fraud.

Mastercard’s Open Banking for Account Opening leverages the secure exchange of consumer-permissioned data from open banking and identity data networks, utilizing industry standards, machine learning, and robust fraud prevention programs. This comprehensive approach enables fintechs and banks to confidently verify the identities of their customers and the ownership of linked accounts. As a result, it promotes secure digital account opening for various purposes, including digital wallets, new bank and investment accounts, distributions, and account-based payments.