Open Banking and business lending explained

What Open Banking is

Open Banking is a UK framework, built on the PSD2 regulations, that lets you give a regulated third party secure, read-only access to your bank-account data through your bank's own systems. Instead of downloading and uploading months of statements, you log in to your bank, approve the connection, and the lender receives a clean, structured feed of your transactions. It removes the slowest, most error-prone step in a finance application and replaces self-reported figures with verified data.

How it speeds a decision

The time saving is real. With statements, an underwriter has to request, receive, read and re-key data, then check it is genuine. With Open Banking, verified transaction data arrives instantly and can be scored automatically — turnover, balances, existing commitments and affordability all read straight from source. That is how some lenders move from application to decision in hours rather than days. It also reduces fraud risk, because the data comes directly from the bank and cannot be doctored the way a PDF can. For what underwriters then look for, see what lenders see in your bank statements.

What a lender can — and cannot — do

The access is strictly limited. A lender using Open Banking for a lending decision gets read-only access to account information: they can see transactions and balances, but they cannot move money, set up payments, or change anything in your account. The connection is granted for a defined purpose and a limited time — often 90 days before it must be re-confirmed — and you can withdraw consent at any moment through your bank or the provider. You are always in control of what is shared and for how long.

Security and privacy

Open Banking is among the more secure ways to share financial data. You never hand your banking login to the lender — you authenticate directly with your own bank, which then authorises the connection. Only regulated providers, authorised by the FCA, can request access, and data is shared over secure, encrypted channels. Your consent is specific, logged and revocable. For directors wary of emailing months of statements around, it is usually the safer option, not the riskier one. Credicorp uses consented Open Banking to assess company affordability and reach faster, fairer decisions. This guide is educational, not financial advice.