Connections invests EUR 200,000 in an open banking fintech platform for the Romanian market

Connections, a leader on the digital transformation market in Romania, Bulgaria and Serbia, is developing an open-banking fintech platform to integrate the APIs provided by Romanian banks with the application of the Revised Payment Services Directive (PSD2), which requires banks to provide access to information about online payment accounts to third parties who can develop information, payment and other financial services to bank customers.

The platform architecture developed by Connections is based on microservices, which offers significant benefits to third-party digital service providers (TPPs) – increased flexibility, fast delivery of new functionalities, simplified testing and much easier scaling of the customer data base. At the same time, the platform responds to increased security requirements for access to consumer data.

“The plans for the next two years include, in addition to launching the first version of the platform in Romania – a market of about 100 million euros – extending the integration with other banks in the EU space, going to the generous goals behind the PSD2 philosophy – outsourcing banking services and the unification of the retail banking market in Europe. Connections explores the expansion of platform architecture for the integration with key players in other industries such as insurance, aiming at consolidating a hub product for the financial services market,” Bogdan Florea, founder of Connections and Vice President of ANIS, says.

The platform is developed through Ontotech, the software development division of Connections, with an initial investment of 200,000 euros.

The PaaS (Platform as a Service) product will be targeted at new open banking services providers as part of Connections’ strategy of consolidating its position as a player on the digital transformation market in the CEE region.

In January 2018, the European Union Revised Payment Service Directive (PSD2), which aims to improve retail banking services for all consumers in the EU and EEA areas, entered into force.

“Romania has not yet transposed PSD2 into national law, but among the potential benefits of implementing the directive, we estimate the improvement of customer experience, the generation of new business models, and new sustainable services for markets that are still untouched. The unification of the retail banking market in the European Union is another objective closer to the adoption of the PSD2 Directive. Opening the market for banking financial services, provided by non-banking institutions, offers enormous prospects for Fintechs, start-ups, and even traditional companies that focus on developing platforms and software components that support the new trend, explains Bogdan Florea.

Modern implementation technologies, combined with the application architecture, give the platform a high level of information quality and security, flexibility and openness to third party application integration, and dynamic component scalability to improve performance and availability.