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1. O pen Banking Ecosystem evolution, risks and opportunities @Kannan_sri1 https://www.linkedin.com/in/kannan- s/ *All opinions are personal. Open banking and Fraud risk management summit - June 4, 2021. Keynote presentation by Kannan Srinivasan.

2. Content 2 Open banking – Primer Evolution of Open banking Ecosystem participants and opportunities Ecosystem risks Evolving into the future

3. 3 Open banking - Primer Consent based financial information sharing Customer consent to share data Bank/FI sharing financial information with third party providers API (or other standard) based data sharing Better customer experience Customers Companies Banks Customers Companies Banks Key Drivers Region specific drivers Customer expectation Technology/Competition Regulatory expectation

4. 4 Banks and individual companies built interfaces for seamless processing Evolution of Open banking Path taken to reach current place Web scraping tech advancement PFM Tools/ Customer Perception Regulatory Requirements PSD/2 in EU Connectivity standards Regional Regulatory Guidance Super App / Big Tech evolutions across the world (Platformication) New business Models Embedded Banking, Embedded finance

5. Open banking evolution across the world 5 México, Brazil, European Union, United Kingdom, Saudi Arabia, Australia Regulator led changes China & Hong Kong, Singapore, India Hybrid (Reg + Industry) Industry led changes United States, Canada, South Africa

6. Changing tides 6 2010 2020 Source: CFTE - Centre for Finance, Technology and Entrepreneurship. Who moved my cheese? Upending business models Connect, Transact, Expand Evolution of top 10 Financial Institutions

7. Ecosystem – Opportunities Potential for massive gains after adjustment Banks & FI Increase reach across industry/new areas New client base Better underwriting models FinTechs New/enriched customer experiences Pushing regulatory boundaries for clarity New Products Companies CX/Retention Embedded finance New revenue lever Data Aggregators Blend data from additional Sectors Enables competition Customers 7

8. Ecosystem – Risks Its not all smooth sailing 8 KYC – AML Compliance Very costly to run independent KYC/AML Program and there are no easy alternatives. Compliance is an important part of the puzzle to ensure wider reach of financial products. Upcoming Regulations New regulations may impact the balance/business models Eg:- Payment schemes in EU/ India. In US, 50 different state laws cover a payment license. In some areas, regulations will provide certainty. Privacy/CCPA Maintaining data privacy will be a challenge for all participants. Multiple DEV, QA Test environments across multiple companies – increased data leak potential. CCPA will be an interesting challenge for data aggregators and the FIs. Fraud Entire eco system must follow toughest security standards as uber connectivity will open up new frontiers in fight against Fraud. The scale and impact fraud could be a lot broader.

9. Evolving into the future The journey from Open banking to Open finance+ 9 Open banking Open Finance + Products Capabilities evolution PFM/Data aggregation. Data Security/ Exchange Deposits, Debit/Credit cards. Identity Management, Authentication, Authorization Credit Products based on new underwriting models, Investments & Insurance. Regulatory Framework, DLT, Smart Contracts Products indistinguishable between Bank and third parties. Standardization, Operational capabilities Financial products can be offered at any customer end point. Cross industry data sharing standards, New business models

10. Q uestions ? @Kannan_sri1 https://www.linkedin.com/in/kannan- s/

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