SMEs benefit from Open Banking revolution in current times

Neeta Gupta
Published in
3 min readMay 6, 2020


When the European Commission introduced PSD2 and Open Banking, several banks didn’t agree to it. They felt that the commission had opened the doors to fintech and now fintechs are going to take away their bread and butter. Banks seemed reluctant to adopt the regulation and were not opening their APIs to fintech. Without open APIs and data access, fintechs will not be able to build customized applications for the customers.

The European Commission had set several deadlines, e.g. Strong Customer Authentication deadline was set to 14th September 2009. However, this deadline was extended as several failed to meet the deadline. More than 6,000 banks in the UK alone were affected by the PSD2 deadline.

Later most European countries promised to release quality APIs publically in 2020. The situation, this year for Open Banking improved drastically, more so because of a global pandemic we all are facing. Open Banking and data sharing adoption have grown and based on that, Fintechs have been motivated to build frameworks. As mentioned, the same would have been unthinkable at the onset of the PSD2 regulation.

Small and medium-sized businesses seem to be one of the dominant drivers of the PSD2 and Open Banking regulations, and they are exploring use-cases to benefit the masses. At first, the regulation use-cases were being limited to the retail sector only.

SMEs, as a potential client for the fintechs, was explored a little later. In the current times, when we all are suffering due to the pandemic, SMEs require the most help. When countries had to initiate a lockdown, most businesses incurred a huge loss. Big corporates and MNCs can survive, but it is difficult for the SMEs to survive the aftermaths of the pandemic.

Optimizing Business Lending

The current market situation is difficult, and the need for SMEs to access capital is more than ever.

CRIF Realtime Ltd, a company which analyses SME credit risk took notice of the circumstances. To save the SMEs, they have launched a suite of products to help the 6 Million (approx.) SMEs are operating in the UK to meet the challenges caused by Covid-19.

These products are available for free to the SMEs. CRIF Realtime has built these products with the help of Open Banking technology; these products enable the SMEs to present a more appropriate picture of their financial performance and viability (both pre and post-pandemic). With this financial report, it would be easier for the SMEs to avail loan and the lenders to make a more informed decision.

Connecting Payment Capacity with Accounts

Increasingly, accounting platforms are exploring how looping into clients’ bank data can streamline data collection, reconciliation and analytics. Open banking enables these platforms to obtain information more quickly and securely. Further, APIs can facilitate collection of this data in real-time throughout the day, rather than overnight or at periodic times during the month.

VibePay, the enterprise solution company behind social payments app have also launched an application to support SMEs. The company had planned to release the products in Q3 of 2020 but have launched it early to help SMEs gain instant access to their funds and improve cash-flow.

The latest products will allow brands to process frictionless checkout and subscription payments online, increasing transaction success and reducing fees, while giving brands a gateway into their engaged Gen Z community.

The VibePay payments API is built on Open Banking and is just one part of the broader Vibe ecosystem. This includes the Vibe Data API, giving brands unique transactional insights into their Gen Z customers, made possible through the Vibe Pay app. The data API gives businesses insights into the products and services Gen Z care about and frequently transact with.



Neeta Gupta
Writer for

A technology enthusiasts who loves to explore