60 1GM Saturday October 17 2020 | the times
Money
Rival companies include Plum, Cleo
and Yolt, which also help you to budget
by setting money aside automatically
every month. Plum transfers the
money from your bank accounts into a
pot that can earn up to 0.6 per cent in-
terest and is managed through its app.
Open banking data can also be useful
to debt advisers if clients share it with
them because it could cut down the
hours they usually spend on the phone
getting to know their finances before
offering tailored debt advice.
New credit reference companies
such as Credit Kudos could also use
your data to give lenders an immediate
snapshot of your finances. Traditional-
ly, lenders would have to rely on infor-
mation from banks about whether or
not you have kept up credit repay-
ments. Open banking could be useful
for those who are struggling to prove
their credit-worthiness because they
have never taken out loans or have
recently moved to the country.0 Is it safe?
The UK is the only country in the Euro-
pean Union to have forced most banksHow Captain Tom started a
W
hen the 99-year-old
former army officer
known as Captain
Tom Moore began
doing laps of his gar-
den to raise money for NHS charities in
April he became a national sensation.
By the time he had turned 100 at the
end of the month he had raised more
than £30 million, was the oldest person
in the UK with a No 1 single and was
getting so much post that the Royal
Mail had to recruit hundreds of volun-
teers to sort through it. But his fund-raising campaign made history for
another reason — he had kick-started a
digital revolution that could spell the
end of credit and debit cards.
The Just Giving fundraising page
used by Captain Tom was one of the
largest tests of a new payment method
that takes money directly from a bank
account without you having to enter
the details on your card. It sounds like a
technicality, but is quicker, and safer,
than regular payments, experts say.
Many of the 1.5 million people who
made donations clicked on a “banktransfer” button and were then asked to
type in the name of their bank rather
than their card number. This automati-
cally opened their bank’s login page in
a new screen, where they were asked to
access their banking as normal by put-
ting in a password and username. If
they were on their phone and used bio-
metric data such as a fingerprint or face
scan, it would have been even quicker.
The bank showed them their balance
and then gave them the option to send
the money directly to Just Giving,
whose details were already installed.
The transaction took seconds.
Since the trial for payments to Cap-
tain Tom, HM Revenue & Customs has
put out a £3 million tender to find a tech
company that could help people to pay
taxes directly from their bank accounts.0 Shape of things to come
The technology known as open bank-
ing was dreamt up in 2016 when the
Competition and Markets Authority
ordered banks to create a secure way to
share data. Ever since, they have been
building the system that lets you share
your income and expenditure with
other financial companies with the aim
of ending banks’ monopolies over their
customers’ data.
It means that the information in your
current account statements can now be
held by the technology company of
your choice rather than sitting in a pile
of unopened envelopes. Through the
technology supplied by your chosen
company, you will be able to see all your
accounts in one place.
While the system is limited to bank-
ing at the moment, it could be applied to
investments and pensions.
The idea is that better analysis of
your data can help you to manage your
money better, switch utility companies
and improve your credit score. Finan-
cial companies benefit because reduc-
ing friction in the payments system
could mean that consumers spend
more or change suppliers more often.
Allied Irish Bank, Bank of Ireland,
Barclays, Danske, HSBC, Nationwide,
Natwest, Santander and Lloyds Bank-
ing Group, which includes Halifax,
have all been working to create a single
data sharing system and smaller banks
are now taking part too. The number of
people using open banking has doubled
this year to two million.0 How does it work?
One in five people started using online
banking apps during the first Covid-19
lockdown and 45 per cent of 25 to 34-
year-olds used money management
apps for the first time, according to an
Opinium survey of 2,000 adults in July.
To see all your accounts in one place
you need to sign up to one of the new
companies that can supply the techno-
logy. Snoop, which is led by the former
Virgin Money boss Jayne-Anne Gad-
hia, has 75,000 customers and claims to
save them an average of £1,500 a year.
Once you have downloaded the
Snoop phone app it asks for your per-
mission to access the data held on you
by one or all of your banks. If you say
yes it takes you to your bank’s login
page, as in the Just Giving example, and
your bank runs its usual security
checks. Snoop then analyses all your
historic transaction data to offer you
personalised savings and discounts.
These could include deals at Sains-
bury’s, or whichever supermarket it can
see that you shop at, or suggestions for
cheaper energy companies based on
your bills. You can choose whether or
not to be notified about new deals.
It is free to use and makes its money
from the companies whose services it
suggests. It also lets you scroll through
your spending from all your banks.The heroic antics of
the army veteran
became the subject of
a digital payment trial
that could eventually
kill off your bank cards,
writes Kenza Bryan
300
the number of
companies licensed
to access data
20%
of people started
using banking
apps in the first
lockdown
90 day
limit on how long
a company can
access your data
Captain Tom’s
Just Giving
page was used
to test a new
payment
method