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Challenges and Opportunities of Open Banking in Emerging Markets

Chief Editors:  Mr. Irshadullah Asim Mohammed, Dr. Yogesh Mohan Gosavi, and Prof. (Dr.) Vineeta Kaur Saluja

Associate Editor: Mrs. Sruthi S

Co-Editors: Dr. S. Rajeswari, Dr. Nikhil Saini, and Ms. Atreyee Banerjee

ISBN:  978-81-985805-1-1

Chapter: 16

DOI: https://doi.org/10.59646/mrnc16/321

Author: Dr. Jagdish Kumar Sahu

Abstract

Open Banking has emerged as a transformative force in the financial sector, particularly in emerging markets where traditional banking systems face limitations in accessibility, efficiency, and innovation. By enabling secure data sharing among financial institutions through Application Programming Interfaces (APIs), Open Banking fosters competition, enhances financial inclusion, and encourages fintech innovation. However, its adoption in emerging markets presents unique challenges, including regulatory uncertainty, cybersecurity risks, lack of digital literacy, and infrastructure constraints. Additionally, concerns about data privacy and consumer trust hinder widespread acceptance. Despite these obstacles, Open Banking offers significant opportunities such as improved financial services, broader credit access, and the acceleration of digital payment ecosystems. This paper explores the key challenges and opportunities of Open Banking in emerging markets, emphasizing the role of regulatory frameworks, technological advancements, and strategic collaborations in shaping its future trajectory.

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