I. Introduction
Open finance — the customer-permissioned sharing of financial data across institutions and service providers — is no longer a distant policy concept. It is live, expanding, and generating real outcomes in a growing number of markets. Brazil’s open finance ecosystem now processes billions of API calls weekly. The United Kingdom’s open banking regime has matured into a reference model studied by policymakers across every region. India, Australia, Colombia, and several African and Southeast Asian markets are at various stages of design and implementation.
For financial sector authorities (FSAs), this presents both an opportunity and a challenge. The opportunity is significant: open finance, if well designed and well supervised, can drive competition, expand access to credit and savings, improve consumer outcomes, and support the broader goals of financial inclusion. The challenge is equally significant: open finance introduces and amplifies risks — to data privacy, consumer protection, operational resilience, and systemic stability — that existing supervisory frameworks were not designed to handle at this scale or speed.
The core argument of our recent working paper, on which this article is based, is straightforward: supervision and oversight must be foundational elements of open finance design, not an afterthought. The countries that treat oversight as something to be figured out once the system is running will find themselves reactive, under-resourced, and perpetually behind the curve. Those that plan for supervision from the outset will be better positioned to realize the policy goals that motivated open finance in the first place — and to course correct when things go wrong.
This article distills the emerging lessons from our research, which is based on country work with a regulator, global desk research, and interviews with financial sector authorities and industry stakeholders across multiple jurisdictions. It is intended for regulators and supervisors who are either designing their open finance frameworks or revisiting the supervision strategies attached to frameworks already in operation.
II. Why Supervision Is Different in Open Finance
Before turning to lessons, it is worth being precise about what makes open finance supervision genuinely different from conventional financial sector supervision — and why that difference matters.
In traditional supervision, the FSA monitors a defined set of regulated entities: banks, insurers, payment service providers. The supervisory relationship is bilateral, and the perimeter is relatively clear. In open finance, the FSA must monitor the ecosystem. Data flows across multiple entities, some regulated and some not, through interfaces (APIs) that may themselves be the subject of standards and governance. The consumer sits at the center of a web of consents, data-sharing agreements, and service relationships that may span many providers simultaneously.
This means that the FSA must maintain visibility not just over individual institutions but over the health, fairness, and performance of the entire ecosystem. It must monitor whether APIs are functioning reliably, whether consent journeys are truly informed and transparent, whether data is being used as authorized, and whether open finance is generating the competitive and inclusive outcomes it promised. These are not tasks that traditional supervisory approaches — built around periodic onsite inspections and regular financial returns — are equipped to perform.
The scale compounds the challenge. Mature open finance markets generate data volumes that are simply unmanageable through manual oversight. Brazil’s ecosystem, for example, processes hundreds of millions of API calls per day. No supervisory team, however well-resourced, can review that data manually. Effective supervision at this scale requires investment in data infrastructure, reporting systems, and supervisory technology (SupTech) — ideally planned and built before the ecosystem reaches scale, not after.
III. Ten Lessons for FSAs
Our research identifies ten lessons that FSAs can draw on as they build or strengthen their open finance oversight and supervision. We organize them below around …
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