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2022-2023 UK Open Banking Report: Overall API performance improved but there is still a ways to go

2022-2023 UK Open Banking Report

Once again, we are excited to share the results from our annual 2022-2023 UK Open Banking report, in collaboration with Finextra.

The CMA9 are the nine large UK banks mandated by the Competition and Markets Authority (CMA) to expose certain Open Banking APIs and regularly return certain reports on the performance of the APIs. The banks are Allied Irish Bank, Bank of Ireland, Barclays, Danske, HSBC, Lloyds Group, Nationwide, NatWest Group, and Santander.

Compared to 2021-22, the CMA9 and traditional banks improved, and, surprisingly, neobanks’ performance declined. As a result, the CMA9 were nearly as performant as challenger neobanks, with smaller traditional banks showing the worst performance. Underperforming and poor-quality APIs are costing the UK banking sector millions in additional engineering overheads.

All three NatWest Group brands had CASC scores between 9.18 and 9.30, making it once again the most performant of the bigger banks, a laudable achievement.

Azure is substantially slower than other clouds.

Underlying infrastructure matters more than ever, with the Azure cloud performing dramatically slower than other cloud providers – and substantially slower than its own performance in 2021-22. AWS and IBM are comparable for the first part of the period, but Azure is the slowest in 2023. Google lies between the two faster clouds and Azure.

Latency is generally considered to become perceptible to end users if the duration of a process exceeds ~400-450 ms. Azure is the slowest cloud overall throughout the 2022-23 period and has a latency >450 ms. If banks rely on Azure, they may suffer from unmet consumer expectations.

Azure also has a median DNS Lookup Time of >70 ms, adding tens of milliseconds of unnecessary latency to calls compared to AWS and IBM, which have median DNS Lookup Times <10 ms; and Google, which has a median DNS Lookup Time >20 ms.

With the notable exception of Azure UK, UK-hosted applications perform better than other locations; due to distance and other factors, we do not recommend hosting in Nordic data centers.

Recommendations based on JROC & OBUK reporting changes

As Open Banking makes its transition to a future entity, the Joint Regulatory Oversight Committee (JROC) will have new requirements for UK banks in 2024. Given the prevalence of underperforming and poor-quality APIs in this sector, we recommend a full evaluation and overhaul of these APIs including cloud choice, location, and latency.

This will serve to meet the full potential of Open Banking and develop a scalable data-sharing model. And by using APImetrics to monitor API performance, banks can save millions per year in time, money and person-hours in API management.

Read more: Over $90 Billion Lost Each Year to Poor API Performance

To see the full report with expanded findings, please visit Finextra.

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