Raise your hand if you belong to a benefit programme linked to your medical aid or other insurance. You’re not alone — thousands of South Africans have elected to share their medical information in order to stay on track with their health goals and get rewarded for doing so.
Open finance is a new way of thinking about how you choose to use and share your personal data. Soon, you’ll be able to maximise the potential of the data you’re already sharing with your bank, your insurance company and the supermarket where you do your monthly shop. By sharing that information safely and securely with trusted fintech companies, you’ll get even more benefits and rewards — and better products and premiums that are tailored to you.
Sharing is caring
Those who work with calculators and spreadsheets call it a “shared value model” — when you share your personal and financial behaviour with your financial planner, insurer or bank. For the insurer, they get to understand groups of individuals like you better, allowing them to be more competitive than other insurers. Sometimes, this advantage comes back to you in rewards like shopping vouchers, cheaper gym memberships and cash in your account.
With open finance, the benefits go way beyond a free smoothie. Sharing your financial data with trusted companies will drive innovation in the industry and you’ll suddenly have access to personalised products and services that will make your life easier, save you money and allow you to plan for the future.
Still not convinced?
Here’s an example of how open finance would work in the real world: Busi is 28 years old and works as a freelance graphic designer. Because she doesn’t have a fixed income and isn’t tied to a single employer, it’s been a challenge for her to get a loan the traditional way (from her bank).
Busi already shares her financial information with 22seven and she uses the app to make sure she keeps her monthly expenses in check. Now, with open finance, she can decide to share that information, along with all her other personal data linked to healthcare and shopping, with other fintech companies and competitor banks. Those companies will now have a much better picture of Busi’s lifestyle and spending habits, and guess what? She’s just been offered that loan she applied for!
In short, open finance will allow new and existing financial companies to securely access data that will enable them to build better products for you. If you’ve struggled with banks in the past because your life doesn’t fit their definition of “normal”, open finance will give you greater access to a range of services to help you manage your money better and safeguard your future.