Open Banking Policy
A policy governing participation in open banking ecosystems, covering API data sharing, consent management, TPP access controls, and FCA regulatory requirements.
What is a Open Banking Policy?
A policy governing participation in open banking ecosystems, covering API data sharing, consent management, TPP access controls, and FCA regulatory requirements.
Regulators across UK, EU treat a Open Banking Policy as a baseline legal requirement. Without one, your business is immediately exposed to enforcement action — regardless of size or industry.
Who Needs a Open Banking Policy?
Banks, payment institutions, and fintech companies operating in open banking and open finance ecosystems.
- Any organisation that banks, payment institutions, and fintech companies operating in open banking and open finance ecosystems
- Businesses operating in UK and EU
- Anyone using third-party services that process data on your behalf
Legal Framework
PSD2 RTS on SCA, UK Open Banking Standard, FCA PSDG 13, CMA Retail Banking Order.
UK
UK GDPR — ICO enforcement
EU
EU GDPR — up to €20M or 4% turnover
What Your Open Banking Policy Must Include
- 1
Account Data Sharing
Account Data Sharing — Clearly define account data sharing so users and regulators understand its scope and why it matters for your compliance obligations.
- 2
TPP Consent Mechanism
TPP Consent Mechanism — Clearly define tpp consent mechanism so users and regulators understand its scope and why it matters for your compliance obligations.
- 3
Data Standards (UK OB)
Data Standards (UK OB) — Clearly define data standards (uk ob) so users and regulators understand its scope and why it matters for your compliance obligations.
- 4
API Security
API Security — Clearly define api security so users and regulators understand its scope and why it matters for your compliance obligations.
- 5
Consent Revocation
Consent Revocation — Clearly define consent revocation so users and regulators understand its scope and why it matters for your compliance obligations.
- 6
Liability Allocation
Liability Allocation — Clearly define liability allocation so users and regulators understand its scope and why it matters for your compliance obligations.
- 7
Fraud Detection
Fraud Detection — Clearly define fraud detection so users and regulators understand its scope and why it matters for your compliance obligations.
- 8
Regulatory Registration
Regulatory Registration — Clearly define regulatory registration so users and regulators understand its scope and why it matters for your compliance obligations.
How to Write a Open Banking Policy
Building a compliant Open Banking Policy from scratch takes legal expertise and hours of research. Here is a framework covering the core steps:
- 1Step 1: Account Data Sharing — Document this section completely and accurately. Vague or incomplete disclosures can be treated as violations even if the underlying practice is compliant.
- 2Step 2: TPP Consent Mechanism — Document this section completely and accurately. Vague or incomplete disclosures can be treated as violations even if the underlying practice is compliant.
- 3Step 3: Data Standards (UK OB) — Document this section completely and accurately. Vague or incomplete disclosures can be treated as violations even if the underlying practice is compliant.
- 4Step 4: API Security — Document this section completely and accurately. Vague or incomplete disclosures can be treated as violations even if the underlying practice is compliant.
- 5Step 5: Consent Revocation — Document this section completely and accurately. Vague or incomplete disclosures can be treated as violations even if the underlying practice is compliant.
- 6Step 6: Liability Allocation — Document this section completely and accurately. Vague or incomplete disclosures can be treated as violations even if the underlying practice is compliant.
- 7Final step: Legal review — Review with qualified legal counsel before publishing, especially if operating in high-risk jurisdictions.
Common Mistakes to Avoid
Copying another website's Open Banking Policy verbatim — Every business has different data flows. A generic copy may fail to disclose what you actually do, creating false statements that are worse than no policy at all.
Using vague or ambiguous language — Regulators and courts expect plain, specific language. Phrases like "we may share your data with partners" are too vague and regularly cited in enforcement actions.
Forgetting to update after product changes — Your Open Banking Policy must reflect current practice. Outdated policies are a compliance liability — some regulators treat an outdated policy as a violation in itself.
Not making your Open Banking Policy easy to find — Buried in a footer or behind multiple clicks, your policy may not meet the "easily accessible" standard required by most regulations.
Missing jurisdiction-specific requirements — A policy compliant in one jurisdiction may still fail in another. If you operate across UK and EU, you need to address each framework's specific requirements.
How Often Should You Update Your Open Banking Policy?
Given the complexity of Open Banking Policy requirements, a quarterly review cycle is recommended — especially if you operate in multiple jurisdictions or frequently update your product.
Consequences of Non-Compliance
Beyond financial penalties, non-compliance with Open Banking Policy requirements can result in: reputational damage and loss of customer trust, app store removal (for mobile apps), inability to process payments (for ecommerce), and difficulty attracting enterprise customers who require compliance evidence.
Frequently Asked Questions
Is a Open Banking Policy legally required?
Yes. A Open Banking Policy is a legal requirement under PSD2 RTS on SCA, UK Open Banking Standard, FCA PSDG 13, CMA Retail Banking Order.. Operating without one puts your business at risk of regulatory enforcement action.
How long should a Open Banking Policy be?
A typical Open Banking Policy runs 8 pages. Length matters less than completeness — every required disclosure must be present, written in plain language that users can understand.
How often should I update my Open Banking Policy?
A quarterly review cycle is recommended for your Open Banking Policy.
What are the penalties for not having a Open Banking Policy?
FCA enforcement. CMA intervention orders. Regulatory withdrawal of PSD/EMD authorisation.
Can I use a free Open Banking Policy template?
Free templates are a starting point, not a solution. A template that was not drafted for your specific business, jurisdiction, and data practices may create false statements — which is legally worse than having no policy at all. Always customise any template and have it reviewed by qualified counsel.
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Read guidePolicifyAI is a technology provider, not a law firm. The information on this page is for orientation only and is not legal advice. Generated templates are intended as a structured starting point for review by qualified counsel before publication.