Open banking

Open banking is a regulatory framework (PSD2 in Europe, similar rules elsewhere) that forces banks to expose customer data and payment initiation via APIs, with the customer's consent. Before PSD2, if you wanted to build a budgeting app that aggregated accounts across banks, you had to screen-scrape — fragile, insecure, against TOS. After PSD2, the bank is legally required to give you a clean API. This is what makes neobanks, account aggregators, and payment-initiation services possible. The mental model: open banking is to bank data what Open APIs are to platforms — it forces incumbents to be interoperable.