Why Nordic countries are perfectly positioned to lead the way to open finance

Written by Yapily · August 25th, 2022

The Nordic region made inroads in this year’s European Open Banking League Table. Renowned for payment innovation and a long tradition of cross-government cooperation, could they be the first countries to unlock open finance?

Last year, we published the industry’s first European Open Banking League Table for banks and industry associations to better understand the wider open banking landscape. We published the second annual report this year, combining our industry expertise with Yapily’s own data to rank 18 countries on a 10-point scale.

Here’s how Nordic countries fared

Sweden: #3 Denmark: #7 Finland: #12 Norway: #14 Iceland: #18

Sweden led the pack in the region with impressive results, largely attributed to its highly developed digital infrastructure and collaborative payments approach.

The rest of the Nordics didn’t fall short of recognition. Its well-established mobile banking landscape boosted each country’s score and pushed Denmark up six places, from #13 in 2021, to #7 this year.

Want to see where other countries rank? Download the full report here.

And, if you want to understand why the Nordics could lead Europe’s transition into open finance, keep reading.

Early digital transformation

According to the Digital Economy and Society Index, the Nordics are among the most digitised European societies.

To start, the Nordics were the first to spearhead digital payments, with Sweden introducing mobile payments in 2012 and the UK following suit in 2013. This is one reason why Sweden is predicted to become the world’s first cashless society by 2023.

And more recently, in 2019, the Nordic Prime Ministers agreed to a new partnership called Vision2030, which aims to push the Nordics to become a leading region in digitisation, ethical AI, and responsible use of data by 2030.

This clearly demonstrates that Nordic countries have been at the helm of financial innovation for decades and were instrumental in kickstarting digital transformation ahead of most of Europe.

Cooperation between governments and banks

Despite having a small population, the Nordics have a large and developed economy with a strong digital presence. Long-standing cooperation between international governments and financial institutions is a significant factor in this.

Here are just a few examples:

  • Introduced in 2019, P27 is a shining example of innovation brought on by collaboration. It’s the Nordics’ first-ever cross-border payment system that enables account-to-account payments to flow within and across Denmark, Finland, and Sweden.
  • SEB, the Nordics biggest corporate bank, teamed up with Nordic Smart Government (NSG) in 2020 to drive the future of data and automation by enabling financial data sharing between businesses. It reinforces two of open banking’s biggest use cases for SMEs: account aggregation and automated accounting.
  • In a quick response to the legalisation of digital signatures, Sweden first introduced e-signatures in 2000, with the UK following in 2002.

Confidence in data-sharing

Data sharing is a widely contended topic across Europe.

But, according to Deloitte’s Data Ethics Consumer Research Report, the Nordic population has expressed higher confidence than many other European countries. 25% of the Danish population say they’re willing to share their data and 22% of Swedes say they’re willing to share their data. Compare this to 15% in Germany, and 19% in Italy.

We can see this reflected in the real world.

Swish, a real-time account-to-account payments platform, was introduced in 2012 by six of Sweden’s largest banks. Today, 8 million citizens use it. That means 80% of the Swedish population is using a payments platform optimised for open banking, which, of course, requires data to be shared through its API.

But while consumers certainly have a say in how their data is shared, it’s actually businesses that have dominated the data conversation. In a scheme that mirrors the ambitions of open banking, the Nordic Smart Government is piloting a project where businesses share digital invoices and order data to improve operational efficiency.

The project has created fertile ground for open banking to mature as confidence builds in B2B data sharing. Paired with the emergence of big data, it’ll unlock more innovative opportunities for Nordic fintechs to leverage.

So, how can open banking change the way businesses in the Nordics interact with each other and their customers?

Open banking uses cases

Plenty of open banking use cases exist across the Nordics and have transformed the financial landscape for businesses and their customers since being introduced. Here, we’ve pared them back to a few key examples to highlight what the market can achieve.

Instant bank payments

Open banking payments are made directly from one bank to another, removing any unnecessary steps in the process. It’s seamless, secure and simple - offering an efficient transaction experience for merchants and their customers.

Onboarding automation

Businesses can leverage open banking data to onboard customers in minutes, creating a significantly faster experience. It also offers a quick and more affordable way to verify customers, allowing businesses to focus on delivering the best customer experience.

Affordability checks

Before open banking, lenders depended on paper documents to assess creditworthiness. Open banking has since streamlined this process. Access to financial data enables lenders to make better-informed decisions and eliminate the risk of non-performing loans.

Yapily in the Nordics

As one of Europe’s leading open banking providers, Yapily is thrilled to have brought coverage to the Nordics last year. We’re currently connected to the following banks across Norway, Denmark, Finland and Sweden:

  • Nordea (9.3 million customers)
  • Swedbank (7.3 million customers)
  • Handelsbanken (6.8 million customers)
  • Danske (5.1 million customers)
  • API provider BEC (2 million customers)

Working with established banks and challenger fintechs, we’re helping more innovators unlock the power of open banking through our platform.

Powering the next wave of innovation

In May, we announced our partnership with Two, a Norwegian fintech, to ease cash flow for SMEs by offering alternative ways to access credit with BNPL and open banking. To see how more customers like Two use Yapily to power their product innovation, check out our customer stories.

And to learn more about the state of open banking across Europe, download a copy of our European open banking league table.

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