Enriching aggregated open banking data with Bud
Open banking creates new opportunities for both established financial institutions and new businesses (both start-up fintechs and firms in other industries). They can begin to think about how the financial data of their existing or future customers can be used in the context of new products and services.
Bud and open banking data
At Bud, we have almost a decade of experience with open banking in Europe. We have shown huge retail banks, start-up fintechs and many financial institutions in between how to get the most out of their customers’ data, while also providing our own open banking aggregation service.
With our aggregation history, we have, from day one, built our enrichment engine in a way that allows it to deal with data of varying quality. The experience of dealing with open banking data has also influenced our technology choices, leading to our decision to establish robust and high-performance architecture from day one. Thanks to our proprietary in-house technology, built on top of the latest advancements in AI and natural language processing, we excel at consistently providing high-quality enrichments.
Accounts connected via open banking will inevitably cover a huge variety of financial institutions, card networks and payment processors, with different conventions on how the transaction is presented and what key details are included – this makes Bud’s adaptive methodology hugely advantageous compared to traditional pattern-matching approaches.
We’ve developed our models using over nine years of industry experience and millions of labelled transactions, and regularly release enhancements to ensure we keep on top of the latest industry changes and newly launched merchants. We’re extremely proud of our market-leading categorization.
The flexibility of our approach extends beyond the ability to work with the best-of-breed aggregators. Our engine can also run in high-performance, synchronous integration scenarios. In fact, some of our biggest clients use it exactly like this, allowing Bud to enrich transactions as a part of mission-critical transaction processing – all with minimum latency and stable output.
Why 1033 is driving the demand for open banking aggregators
With the arrival of Section 1033 of the Dodd-Frank Act—a regulation mandating financial institutions provide customers with access to their financial data in a secure format—there has been a drive in demand for effective data aggregators.
Serving as intermediaries to facilitate connections between consumers, banks, fintechs and third-party applications, open banking aggregators such as Akoya, MX, Plaid and others are providing financial institutions with the ability to share their customers’ financial data securely and efficiently.
By using these aggregators, financial institutions can develop truly customer-centric and hyper-personalized services, improve user experiences and deliver robust financial solutions like PFM, payment and lending services. Where consumers will really notice a difference, though, is not just the linking of accounts but instead the natural automation of bill management, payments, transfers and more.
The transparency provided by Section 1033 should also encourage consumers to embrace secure data-sharing practices, resulting in greater user adoption, improved data security and, more importantly, better banking experiences. This is because aggregators reduce the complexities of data integration, allowing financial institutions to focus on delivering value to customers while ensuring compliance with data privacy and security standards.
The changes brought in by Section 1033, namely the standardization of data across financial institutions, will also improve access to usable data across the industry, hopefully creating limitless opportunity to improve customer experiences, develop next-gen digital banking solutions and, ultimately, maximize revenue and ROI.
A deep-dive into the Bud engine
Our engine harvests all available information from every transaction. Because we were never dependent on MCC codes, we can reliably process any type of transaction, regardless of the quality of data.
Bud offers all of the following enrichments for open banking data:
- Market-leading categorization, with three levels of granularity and over 210 categories at the most granular level, allowing for a high degree of nuance and personalization.
- Merchant identification, including logos and contact details, with our coverage exceeding 76% of transactions and an accuracy consistently >99% across states.
- Location detection, down to street level granularity and latitude-longitude coordinates, with support for tens of millions of unique POIs globally and the ability to differentiate between card-present and card-not-present transactions.
- Identifying recurring transactions, such as a customer’s weekly supermarket spend, mortgage or rent payments, and video streaming subscription. You can use this to forecast future payments and how these could impact your customers’ cash flows.
- Further insights built on top of our core enrichments, such as income verification and forecasting, as well as spending totals. You can even build your own insights using our powerful query language, allowing total flexibility to get the exact results you need.
How to source data with Bud
Connectivity and enrichment are often provided as one service, but our UK experience has guided our decision to focus on transactional intelligence, especially in the US. Building connectors and maintaining them is a major task that requires its own approach.
In the markets where we operate, there are already high-quality aggregators with good coverage. But very few of them are able to provide the same level of service as us when it comes to enrichment, as has been demonstrated time and again in benchmarking exercises where we outperform our competitors.
We understand how your customers’ data can be used most effectively - and because we want to continue to focus on this, rather than connectivity, in the US we operate as the enrichment specialist alongside open banking aggregators. We maintain an agnostic approach and emphasize the plug-and-play nature of our services, which puts us in a unique position to consider organizations that already have open banking-based services and processes – or are thinking of entering this space, seeking both superior coverage and the best possible data quality.
As well as being able to send us data from your aggregator of choice, we also offer our own open banking solution in partnership with a major player in the space, allowing your customers to securely connect their accounts and share their data from over 500 million checking accounts and over 400 million credit cards in the US alone.
This makes our solution available as an end-to-end, turnkey platform. However, at any point our enrichment APIs are available as standalone for immediate use. We’ll also continually monitor for newly-launched open banking APIs, so you can rest assured our market coverage will continue to improve with every iteration.
Building with Bud beyond enrichment
The depth of our enrichment stems from our understanding of how our clients want to use their customers’ data. We offer our own advanced analytical tools:
- Assess provides a real-time view on a customer’s affordability and risk profile as an augmentation to traditional credit scoring models
- Drive, our customer data platform with AI models detecting patterns of interest and dozens of complex characteristics generated for each customer.
Capitalizing on the rich dataset you already hold
Financial transactions remain the key to understanding customers. The changing regulatory landscape and ever-increasing competition make it essential for any financial institution to consider how they make the most of this rich data set.
Ensuring that all possible insights are identified is an essential part of this process. And with open banking, it's possible to build a full understanding of the customer even (or - especially) if they transact with a competitor. Bud is the right partner for this journey.
Interested in seeing how we perform? Test our enrichment today
Looking to integrate with Bud?
If time is of the essence, you’ll be happy to hear our platform is quick and easy to get started with:
- Our plug-and-play approach to data ingestion and enrichment means you don’t have to worry about differences between banking aggregators or regions, freeing you up to focus on how to drive value for yourself and your customers.
- We offer a sandbox environment for you to develop in, and provide a wealth of guides, API documentation and example Postman collections on our website with tips and best practices tailored to your use case.
- Our platform supports multiple enrichment flows, including low-latency synchronous enrichments (sub-5ms per transaction) for situations where real-time results are vital.
- We flexibly support enriching data from any open banking aggregator, and we also equally-well handle data sent directly from any bank, payment network or processor. You can even mix-and-match data sources for a single customer, giving you the most complete and accurate picture possible.
- It’s common for clients to go live on our platform within weeks of contract signature because we’ve made it easy to ingest and enrich transactions, typically requiring API calls to no more than three to five distinct endpoints.
- Our friendly client success team will be on hand to provide you with help throughout your initial implementation.
