Nick Rugg, Senior Underwriter,Financial Institutions and Fintech, Markel International.
Whilst Open Banking will bring opportunities, what risks do you think could arise?
Transactions involving the sharing of data and the movement of funds will always carry risk. Where there are multiple parties involved in these transactions there is clearly heightened risk. The exposure to fraud, theft and data loss for banks, account information service providers and payment initiation service providers will no doubt be a key concern for these companies.
What can companies within the Open Banking space do to protect themselves against these risks?
As well as having strong customer authentication and data protection procedures it is vital that companies also have the right insurance policy in place. The right insurance policy is key for companies that wish to gain FCA authorisation to offer account information services and payment initiation services and to protect themselves against the liabilities that may arise from offering these services.
Is there adequate insurance cover available to companies that are looking to offer account information or payment initiation services?
The market for the type of insurance that AISPs and PISPs need in order to gain FCA authorisation is very small, however the Markel fintech insurance policy has the covers required for these companies to become authorised and we are very proud to say that our insurance policy has formed part of many companies successful applications for authorisation from the FCA.
What can AISPs and PISPs do to ensure that they have the right insurance cover in place when applying to the FCA for authorisation?
The right insurance policy is critical for FCA authorisation so it’s important that companies wishing to offer account information and payment initiation services speak to an experienced insurance broker or insurer of fintech companies in order to arrange the right level and breadth of cover required for successful authorisation.
What do you hope to get out of the Finance Edge’s Open Banking Summit?
It will be a great opportunity to meet some interesting people within the Open Banking sphere and to hear about their ideas and experiences. And hopefully they will be interested to hear what I have to say too!