Blog by: Mike Kane, Co-Founder of Hydrogen
Open banking started as an European Union directive in 2015, known as PSD2. It was administered to get financial institutions to open their APIs to allow third-parties to build applications and services on top of data. This initiative has now spread globally, but there has yet to be meaningful product layers built on top of the financial data.
The end goal of open banking was to increase competition and provide a level playing field by regulating consumer protection. However, only about 49% of consumers feel comfortable sharing their data with companies through open banking. Gaining the consumer’s trust is critical when it comes to adopting open banking, and we realize the importance of this, here at Hydrogen.
Trust must be established for any relationship to be successful, which is why Hydrogen recently announced that our platform is now available on the Oracle Cloud Marketplace and can be seamlessly added to the Oracle Financial Services Digital Innovation Platform for Open Banking. With 430,000 customers in 175 countries, Oracle is one of the most trusted technology firms in the world and Oracle customers can now leverage the power of Hydrogen’s award-winning secure and scalable enterprise grade cloud platform on Oracle Cloud Infrastructure (OCI).
Oracle Financial Services Digital Innovation Platform for Open Banking
The Oracle Financial Services Digital Innovation Platform for Open Banking (DIP) is an open banking API enabled solution that is built on top of the Oracle Cloud which serves as the foundation for building, integrating, monitoring, and securing applications, as well as for driving new insights.
Through its extensive catalog of services, such as lending, payments and predictive analytics, the DIP enables financial institutions and fintechs to expedite innovation and monetization with a single enterprise cloud platform.
Oracle Financial Services Open Banking Platform equips customers with a best-in-class open banking solution that, among many other benefits, delivers high-value and cost effective financial products and services, improved operational efficiency, and creates new revenue channels by exposing APIs and monetizing current banking assets.
Accelerating Financial Innovation with Hydrogen
With the Hydrogen platform integrated with Oracle’s open API banking cloud offering, Oracle customers can accelerate their digital financial innovation by quickly building hundreds of solutions using a single platform. Hydrogen’s powerful toolkit consists of one connected set of configurable APIs, one integration library, and one standardized data model, with added business logic and modular UI components to build end-to-end investing, savings, insurance, wellness, and many other applications.
The Hydrogen platform is able to accomplish this because it can integrate with any third party system, provide core data storage and financial engineering, and create end-to-end client-facing web or mobile applications.
Financial Wellness Use Case
As we’ve previously mentioned, the Hydrogen platform can be leveraged to create numerous financial applications. One example is a data rich financial wellness application that can be built with the joint tools available from Oracle and Hydrogen. In this use case, the wellness application will highlight personal finance management (PFM), budgeting, financial health, and planning.
The application starts by pulling in the users financial data through their various accounts with multiple financial institutions. Hydrogen extends this functionality through an integration library and chooses from various aggregation vendors and then pull the data automatically back into the Hydrogen platform.
Once the user has selected the financial accounts they want to review, they are taken to their financial wellness dashboard. This data is stored in the Hydrogen platform and synced via vendor integration. The application can now perform analytics on the financial wellness of the user such as net worth tracking and cash flow analysis.
Users can also create and update budgets. After banking and credit card accounts have been synced, the application can check the budget against categorized transactions and users can automatically view their progress toward a configurable budget.
The user can also receive a health score across their finances using the aggregated data. This score can be computed using the financial data stored, either by comparing to other users in the application, or based on a rule of thumb.
Lastly, interactive calculators can be shown next to each score to give the user additional advice. For example, Emergency Fund Calculator returns a total recommendation along with a plan to save for the total recommended amount in a variety of horizon intervals.
With Hydrogen as an added layer on top of the Oracle Financial Services DIP, financial institutions can quickly and cost-effectively create new revenue models and mitigate risks with an enterprise-grade platform. The average Oracle Cloud customer can save over 80% in product development cost and time by leveraging the joint Hydrogen/Oracle model.