Riga-based fintech startup Nordigen has announced the launch of the first-ever free open banking API platform. This platform will let developers in companies of all sizes to access PSD2 open banking data from all major banks across Europe via the API. This new platform from Nordigen is claimed to provide connectivity to over 29 countries across the EEA (European Economic Area), including the UK.
Nordigen’s free open banking platform
“For the majority of fintechs, accessing open banking data is prohibitively expensive. Incumbent open banking companies require payment for every single connected end-user, meaning the cost of access rapidly rises for fintechs as they scale. Moreover, the market is difficult to navigate – there are more than 380 AISPs in Europe, many of which offer connectivity as a service. Each of them has a different pricing model and API documentation,” says Nordigen in a press release.
“This makes accessing open banking data both expensive and technically challenging, while the limited geographical coverage of most existing providers forces clients to resort to a patchwork of different solutions. Usage of PSD2 is not yet mainstream beyond the UK,” it further explains.
The fintech startup claims that its new freemium, pan-European model removes the financial barrier while simultaneously simplifying the process of choosing and integrating to an open banking platform.
The new data connectivity platform of Nordigen complements its expertise in data analytics. Founded in 2016 by Roberts Bernans and Rolands Mesters, this Latvian fintech startup has helped global clients extract more value from data in order to make better decisions, especially when it comes to estimating the creditworthiness of loan applicants. Also, the company plans to raise a Series A funding round sometime in 2021.
It works with banks, lenders and fintechs in 19 countries, helping them leverage open banking data for lending, personal finance, automated customer screening and customer onboarding.
Rolands Mesters, CEO and co-founder, Nordigen says, “Our new freemium model is there to help more fintechs solve real-world problems, and there has never been a more crucial time for this. The Covid pandemic is accelerating uptake and showing us a glimpse of the transformational potential open banking has to offer, but we need something more to help companies turn their bold visions into reality. Free access to open banking is that.”
How about the competition?
The open banking platform of Nordigen positions it against competitors such as Tink and Plaid. Unlike competitors that need heavy technology stacks using custom bank integrations, Nordigen offers a freemium service with a lightweight technology stack that relies exclusively on PSD2 bank connections.
Built with APIs in mind, the open banking platform of Nordigen focuses on providing the raw banking data that most developers require. It does within a steady and robust manner sans the necessity for screen-scraping or reverse engineering, claims the company.
Rolands Mesters, CEO and co-founder, Nordigen, says, “In Europe, the business model of charging for open banking data, as Tink and Plaid do, will soon be history. Nordigen is the first to launch a free open banking data service, but we certainly won’t be the last. We believe the future of open banking is in the freemium model and that the rest of the industry will soon follow.”
Main image picture credits: Noridgen
