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Fintech firms uncertain about UK banks' readiness for 'open banking'

U.K. financial technology firms have decided to delay plans taking advantage of so-called open banking rules, after many banks were granted an extension to implement changes, Reuters reported.

The rules require banks to allow other firms to access customer data from banks so they can offer competing products. The U.K. Competition and Markets Authority

Only Lloyds Banking Group Plc, Danske Bank UK and Allied Irish Banks Plc were in compliance with the regulation by the Jan. 13 deadline, the newswire reported. In December 2017, the U.K. Competition and Markets Authority gave Barclays Plc, HSBC Holdings Plc, Royal Bank of Scotland Group Plc, Santander UK Group Holdings Plc and Bank of Ireland Group Plc more time to comply. And Nationwide Building Society asked for more time just days before the deadline.

"We have decided to postpone our open banking implementation until all the banks can prove they have ... all the required data available," Steve Tigar, CEO of app Money Dashboard, was quoted by Reuters as saying.

Monzo co-founder Paul Rippon said the payments firm had "made a conscious decision not to rely on open banking in the immediate term."

Meanwhile, U.K.-based peer-to-peer lender Funding Circle Ltd decided to redirect resources — originally meant for a platform to integrate banks' data — elsewhere, given the uncertainty surrounding banks' compliance and readiness.