Artificial intelligence (AI) and Europe’s new Financial Data Access (FiDA) rules are converging into one of the most powerful transformation levers the industry has seen in decades, but the real value will only flow where firms combine credible data, compelling use cases and modern core platforms. At December’s Nordic Banking Forum, organised by Fintech Farm Helsinki, Alan Goodrich, Regional Sales Manager at ERI, participated in a “fireside chat” discussing how best to unlock the potential value of AI and FiDA.
From ATMs to AI and Open APIs
The digital transformation of financial services did not start with mobile banking apps; it arguably began in 1967 when Barclays installed the first ATM in London, kicking off a 60–year journey toward today’s open finance agenda. By the time PSD3 and FiDA are expected to apply in 2027, the sector will have spent generations cautiously modernising, reflecting its naturally conservative and risk‑averse culture that has slowed the pace of innovation.
Yet while Europe has been methodically iterating, many less mature markets have leapfrogged ahead, using mobile and embedded finance to rewire customer experiences from Madagascar to Korea, from East Africa to China, and from Brazil to the Philippines, often outpacing EU progress in everyday digital finance.
Open Finance (FiDA) and the “Demand Gap”
FiDA and broader open finance regulation promise secure data mobility via APIs, amplifying trust, transparency and competition while feeding a new wave of AI‑enabled propositions. Embedded finance alone is expected to generate billions of euros in additional EU revenues by 2027 as banking fades into the background of lifestyle journeys, from e‑commerce to mobility to wealth.
However, regulation on its own does not create demand. In the EU, parts of the industry have pushed back against FiDA, arguing that tangible market appetite is unclear, in sharp contrast to some Latin American markets where progressive regulation and entrepreneurial imagination are actively generating new demand. Australia offers a cautionary tale: despite advanced open finance rules, strong resistance from incumbents effectively choked innovation, much as PSD2 in Europe failed to deliver on its boldest expectations.
Where AI And FiDA Can Unlock Real Value
The simple truth is that AI is only as valuable as the data it consumes, and without timely, integrated, high‑quality datasets, even the most sophisticated models will fail to deliver impact. FiDA‑enabled APIs can provide the holistic, cross‑institution view needed to personalise services, but banks and wealth managers must first prioritise concrete, demand‑driven use cases rather than generic “innovation” for its own sake.
Wealth management is a prime candidate. Access to aggregated, permissioned data across a client’s holdings, cash flows and obligations will allow hyper‑personalised portfolios, tax‑aware advice and dynamic nudges that benefit both clients and advisers. Another high‑value space is small business finance, where richer data on invoices, cash‑flows and obligations can improve credit decisioning, reduce friction and expand access to funding for entrepreneurs.
Start With Customers, Not Consultants
To unlock this value, firms need to re-imagine the traditional transformation playbook. Banks should invest in direct customer discovery, co‑designing journeys with the people and businesses they serve. Structured interviews, ethnographic research and rapid prototyping reveal what customers will actually adopt, and therefore where AI and FiDA can generate real returns on investment.
Consulting reports and industry surveys still have an important role to play but relying on them solely as primary input risks misreading demand signals and replicating undifferentiated features that fail to move the needle. Clear, evidence‑based insight into what customers need, value and are willing to pay for is the most solid foundation for a successful AI and open finance strategy.
Modern Cores: The Hidden Prerequisite
Even the sharpest customer insight cannot compensate for a technology stack that is unable to deliver. Real‑time, enterprise‑integrated data platforms that provide a single source of truth are essential to orchestrate business processes, interface with external APIs and feed AI engines at scale. Legacy cores that batch‑process overnight and fragment data across silos will struggle to participate credibly in an open finance ecosystem.
There is broad agreement that deep core transformation is inevitable where existing platforms are not fit for FiDA‑ready, AI‑enabled banking, but the optimal strategy is still evolving. Earlier fashions favoured stripping functionality out of the core and scattering it across surrounding applications, yet this has often created a new “digital spaghetti” that is just as inflexible when asked to support sophisticated API products and data‑hungry models.
A more promising approach is emerging: deploy a modern, parallel technology stack and progressively migrate business onto it, creating a digital business paradigm alongside legacy. Institutions can onboard new generations of customers directly onto the new platform, then invite existing clients who show appetite for FiDA‑enabled innovations, such as embedded wealth services or AI‑driven SME financing, to transition as well.
A Glimpse of The Next Decade
Looking ahead five to ten years, the banking landscape may look radically different, with fewer but larger providers offering services that feel less like discrete products and more like an operating system woven into daily life. Traditional leaders and scaled challengers could coexist in a market where “digital banking” is no longer a special channel but simply the way finance operates, invisible yet ubiquitous.
In that world, the winners will be those who use FiDA and AI not as buzzwords but as tools to solve specific customer problems on top of robust, real‑time data foundations. For institutions ready to rethink their cores, listen harder to their customers and lean into open ecosystems, the next chapter of financial services looks less like an incremental upgrade and more like a step‑change in how value is created and shared.
AUTHOR
Alan Goodrich, Regional Sales Manager at ERI
Alan has 35+ years of experience in finance and technology, with expertise as a Fellow of the Institution of Analysts and Programmers and a General Registered Representative of The Securities Association. He’s held senior roles at leading financial firms and technology suppliers. Currently, he serves as Regional Sales Manager at ERI, overseeing Benelux, Nordic, Baltic, and SEE territories.
ERI
ERI is the supplier of OLYMPIC Banking System, offering award-winning levels of innovation, built on real-time data management, process automation and compliance, enabling open APIs and AI use cases, with low-risk implementation at a very competitive total cost of ownership (TCO).
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