Open banking in Germany: What businesses need to know

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  1. Introduction
  2. What is open banking?
  3. How does open banking work?
  4. What opportunities does open banking offer for German businesses?
  5. How has open banking developed in Germany?
  6. What are the advantages of open banking?
    1. Advantages for customers
    2. Advantages for businesses
  7. Is open banking secure?
  8. What are the requirements and guidelines for open banking in Germany?
  9. What open banking platforms are there?
    1. API platforms for banking integration
    2. Account information services (AIS)
    3. Payment initiation services
    4. Platforms for open finance
    5. Infrastructure providers for banks and fintech services
    6. Marketplaces for financial services
  10. Examples of open banking
    1. Digital bookkeeping
    2. Automated credit checks
    3. Real-time payments in online shops
    4. Digital accounts
    5. Asset overview and investment advice
    6. Automated tax assistance

Open banking has revolutionised the financial world, enabling banks and third parties to securely exchange banking data. In Germany, open banking has become particularly important. It has created new opportunities for businesses through improved payment services, automated accounting processes and integrated financial solutions.

In particular, fintech services and software as a service (SaaS) providers from the Germany, Austria and Switzerland (DACH) region use open banking to simplify customer experiences and digitalise financial processes. Germany comprehensively implemented the requirements of the EU Payment Services Directive (PSD2) early on. The country is actively involved in developing further technical standards, such as the Berlin Group's NextGenPSD2 interface.

In this article, we explain open banking, how it works and its requirements and guidelines. We also cover its advantages for German businesses and how open banking has developed in Germany so far.

What's in this article?

  • What is open banking?
  • How does open banking work?
  • What opportunities does open banking offer for German businesses?
  • How has open banking developed in Germany?
  • What are the advantages of open banking?
  • Is open banking secure?
  • What are the requirements and guidelines for open banking in Germany?
  • What open banking platforms are there?
  • Examples of open banking

What is open banking?

Open banking refers to the regulatory opening of banking interfaces to external service providers. In the EU, PSD2 has formed a legal basis for open banking since 2018. It requires banks in Germany and other EU countries to allow third parties – such as fintech services, accounting platforms or payment service providers – to access account information, as long as the customer actively consents. Open banking aims to improve the financial sector, strengthen competition and give customers more control over their payment data.

How does open banking work?

Open banking in Germany involves application programming interfaces (APIs) that authorised third parties can use to access bank accounts or initiate payments. To do so, customer consent is always necessary. Data transfers are encrypted and compliant with high security standards. These security measures include mandatory strong customer authentication (SCA) in accordance with PSD2 (e.g. two-factor authentication).

What opportunities does open banking offer for German businesses?

The use of online banking in Germany has increased significantly, from 56% of the population in 2020 to 67% in 2024. For those over age 65, usage grew from 31% in 2020 to 54% in 2024.

This increase could be attributable to the following opportunities that open banking can provide to businesses:

  • More efficient payment processes: With open banking, businesses can initiate payments directly via specialised applications without having to rely on traditional online banking portals. This can save time and reduce manual errors.

  • Automated accounting and liquidity planning: By accessing account data in real time, accounting and financial planning tools can run automatically. Processes such as payment reconciliations, liquidity forecasts and dunning procedures become faster and more precise.

  • Better overview of multiple bank accounts: Many businesses have multiple bank accounts at different institutions. Open banking enables a consolidated view of all accounts. Therefore, business owners can easily find the information they need in one centralised location.

  • Improved financial services: Fintech services and other third parties have developed new solutions based on open banking. Examples include dynamic credit offers and customised payment solutions for e-commerce or B2B commerce.

Stripe Financial Connections, for example, gives businesses in Germany a powerful solution to gain direct access to their customers' bank account data via a secure API, but only with their express consent. This allows account information, balances and transaction data to be seamlessly integrated into existing processes. With Financial Connections, businesses can automate credit checks, optimise recurring payments or accelerate financial onboarding processes. It's all PSD2-compliant, using established security mechanisms, such as encryption and SCA.

How has open banking developed in Germany?

Germany implemented PSD2 on 13 January 2018. With the NextGenPSD2 standard, the Berlin Group has created a Europe-wide technical framework. This framework implements the access to account (XS2A) required by PSD2 in a standardised, secure way. It is now considered the de facto standard for account-based interfaces in Europe.

Open banking is limited to secure access to payment accounts and transactions. However, there is an industry-wide shift toward open finance more generally. Open finance aims to include other financial areas in the future – such as insurance, investments or pension provisions – in data-supported, interoperable services. This is a project the EU Commission is specifically promoting with its Open Finance Strategy.

The practical implementation of open banking in Germany was initially slow, but it's gaining significant relevance. The COVID-19 pandemic accelerated digital transformation in the financial sector and forced banks to expand their offerings. Meanwhile, the open banking market in Germany is experiencing strong growth. According to an analysis by Grand View Research, open banking market revenue in 2024 was over $2 billion USD. Forecasts suggest that this value could rise to approximately $9 billion USD by 2030, with a compound annual growth rate (CAGR) of 26.5%.

Customers are also growing more accepting of open banking. According to a survey, 40% of Germans are open to new payment methods, especially 18–29-year-olds at 51%

What are the advantages of open banking?

Open banking has several advantages for customers, businesses and the financial sector. Here are a few of the most important advantages:

Advantages for customers

Transparency and control

Customers receive a comprehensive overview of their finances and share their data in a targeted manner. They can also manage their finances centrally across different banks and decide which third parties can access their data.

Personalised financial services

By accessing account information in real time, third-party providers – such as fintech services or digital banks – can develop customised financial services that are precisely adapted to customer needs and behaviour.

Easier payments and account switching services

Open banking enables smoother, faster and more user-friendly financial processes. These include direct payments, integrated payment functions in apps and online shops, increased security through SCA, simplified account switching services and better transparency in payment status.

Increased competition

New providers other than banks can enter the market and develop solutions. This competition can lead to better options and offers for customers. Competition can also stimulate business, as traditional banks are forced to become more customer-oriented and digital.

Advantages for businesses

Improved services

Fintech businesses can use real transaction data to deliver personalised offers, develop customised solutions for budgeting and lending and provide improved tools – from household budgeting apps to automated savings and investment solutions.

Automated accounting and financial analysis

Businesses can use open banking to automatically integrate financial data directly from their business accounts into their accounting and analysis tools. They can do this in real time without any media disruption.

Improved liquidity planning

Businesses can access current account information and transaction data at any time. This allows for more precise and future-oriented liquidity management.

Integration of new business models

Businesses can integrate banking functionalities directly into their own products, platforms or services. This allows them to develop new business models based on data.

Increased efficiency

Automated processes can save time and reduce the risk of error. They can also reduce transaction costs and allow businesses to avoid credit card fees. A faster flow of money is particularly beneficial for e-commerce and digital business models.

The overall economic benefit must also be taken into account. Transparency and efficiency in the financial system can enhance trust. Likewise, general competition can drive improvement and cost savings and financial inclusion can expand access to banking services.

Is open banking secure?

Open banking is secure, as long as it is implemented and operated correctly. The security standards in Europe – especially in Germany – are among the strictest in the world. Here are some of Germany's open banking security standards:

  • Regulation by the Federal Financial Supervisory Authority (BaFin): In Germany, BaFin supervises all open banking providers.

  • Customer authentication processes: The PSD2 directive requires two-factor authentication to prevent unauthorised access.

  • Data encryption: Data is transmitted and stored according to the strictest security standards.

What are the requirements and guidelines for open banking in Germany?

PSD2 regulates open banking in the EU and was implemented in Germany via the Payment Services Supervision Act (ZAG). BaFin supervises providers, ensuring that they meet the legal requirements.

In the future, the Financial Data Access (FIDA) regulation will create a framework for open finance and further standardise access to financial data.

If businesses want to use open banking or invest in their own open banking solutions, they should consider several factors, from technical implementation to legal requirements:

  • Secure and control data: Access to bank data is only permitted with express consent. Businesses retain control over their data at all times.

  • Choose providers carefully: Not every third-party provider automatically meets the security standards needed to comply with PSD2. Certifications and PSD2 compliance are important selection criteria.

  • Seize important opportunities: Open banking is more than a technical detail. It can improve business processes and enable new business models.

  • Understand legal requirements and regulations: Open banking providers in Germany are regulated by BaFin and must comply with all requirements. Providers who use account information or initiate payments require a license as a payment institution or must work with a licensed partner.

What open banking platforms are there?

Open banking is not a uniform product. Instead, it is an interplay of specialised platforms with different tasks and target groups. Various platforms can be used, depending on the technical orientation, functions and area of application. These form the foundation of an increasingly interconnected open banking environment that supports banks, businesses and developers in their efforts to implement modern financial solutions. Here are some examples of open banking platforms:

API platforms for banking integration

These platforms provide APIs that third parties can use to access account data and payment services. They serve as a technical link between banks, apps, financial tools or online shops.

Account information services (AIS)

These platforms make it possible to combine information from different bank accounts into one application. This provides customers with a consolidated financial overview (e.g. for analysing income and expenses or for budget planning).

Payment initiation services

These solutions enable third-party providers to execute payments directly from the bank account on behalf of customers, such as for instant transfers in e-commerce or for automated invoice payment.

Platforms for open finance

Open finance platforms go beyond the basics of open banking. These platforms integrate bank accounts and other financial products, such as securities accounts, insurance and retirement plans, among others. The goal of these platforms is comprehensive financial transparency and automation.

Infrastructure providers for banks and fintech services

These platforms are for businesses that want to develop their own open banking products and services. They provide technical tools, such as secure API gateways, sandbox environments, regulatory services and data analytics.

Marketplaces for financial services

Some platforms act as intermediaries among banks, third-party providers and customers. For example, they bring together different services and enable the integration of multiple applications via a central environment.

Examples of open banking

Open banking enables several applications that simplify, automate and improve security for customers and businesses. Below are some examples of how diverse and practical open banking solutions are already being used:

Digital bookkeeping

Customers can combine multiple bank accounts via one app to get a central overview of income, expenses and savings goals. This allows them to create budgets automatically and easily analyse financial habits.

Automated credit checks

When applying for a loan, customers can allow sharing of account information. Their credit can then be checked in real time, based on actual incoming and outgoing payments. This allows for faster and more precise checks than traditional credit data.

Real-time payments in online shops

When paying in an online shop, a customer can log in through their bank and authorise payment directly. The payment is then transferred immediately, without the delays that might happen with credit cards or digital wallets.

Digital accounts

When opening a new account or switching providers, existing account information can be used to prove identity, salary receipts or regular payments, without any paperwork.

Asset overview and investment advice

By accessing all accounts, portfolios and financial contracts, an app can create a comprehensive asset overview. Customised savings and investment strategies can be developed based on this information.

Automated tax assistance

Open banking data can be used to automatically record income, expenses and tax-relevant transactions. This function can be helpful for self-employed people preparing tax returns.

The content in this article is for general information and education purposes only and should not be construed as legal or tax advice. Stripe does not warrant or guarantee the accuracy, completeness, adequacy, or currency of the information in the article. You should seek the advice of a competent lawyer or accountant licensed to practise in your jurisdiction for advice on your particular situation.

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