TWAs (three word acronyms) in FS (or maybe two word acronyms)

At Moneyhub’s Open Banking party, their CTO (oops, that’s Chief Technical Officer) Dave Tonge made a valiant attempt to avoid the ocean of acronyms in banking and regulation.
 
If bank-speak leaves you thinking WTF, here’s a quick guide to twelve of the most commonly used abbreviations:
 
FCA – Financial Conduct Authority
Previously the FSA (Financial Services Authority) the FCA (it’s not about services, it’s about conduct) is the UK’s financial services industry regulator. It’s their job to protect customers, keep the industry honest and stable, and promote healthy competition.
 
PSD – Payment Services Directive
This European legislation allows bank customers to use third parties (like Moneyhub) to manage their finances. There have been 2 PSDs so far. There may be more.
 
CMA – Competition and Markets Authority
These are the guys who ordered the nine largest current account providers in the UK, fondly referred to as the CMA 9 - that’s AIBG (Allied Irish Banking Group), Bank of Ireland, Barclays, Danske, HSBC (Hong Kong and Shanghai Banking Corporation), Lloyds Banking Group, Nationwide, RBS (Royal Bank of Scotland) and Santander) to deliver consistent open API (see below) standards and a security framework for banking in the UK.
 
OBS – Open Banking Standards
The Open Banking Standards were set out by the OBWG (Open Banking Working Group) appointed by HMT (see the next definition). The OBS provides a guide to how open banking data should be shared and used by its owners and by anyone who accesses it.
 
HMT – Her Majesty’s Treasury
HMT, aka (also known as) the Exchequer or just Treasury, is the UK Government’s economics and finance ministry. As such, they are responsible for financial services policy including banking and financial services regulation, financial stability, and ensuring competitiveness in the City.
 
RTS – Regulatory Technical Standards
The Regulatory Technical Standards are the guidelines set out by the EBA ( see below) to ensure strong customer authentication and secure communication in Open Banking.
 
EBA – European Banking Authority
The European Banking Authority regulates and supervises the European banking sector. It’s responsible for maintaining financial stability in the EU and safeguarding integrity and efficiency in banking.
 
API – Application Programme Interface
An API is code that allows two software programs to communicate with each other, receiving requests and sending responses. Open banking means third parties can develop new products and services to enhance the experience customers have with their financial services providers using APIs. 
 
KYC – Know Your Customer
KYC refers to the practices banks use to verify their customers’ identities. Banks, fintechs, credit companies, life, pension and insurance businesses all require detailed customer information to make sure they are not involved in corruption, bribery or money laundering.

GDPR – General Data Protection Regulation
Yes, OK, it’s a FWA (four word acronym), but it’s an important one, not just in financial services.  GDPR is regulation that requires ALL (emphasis, not acronym) businesses to protect the personal data and privacy of EU citizens for transactions that occur within EU member states, with severe fines for those who fail to comply. It comes into force in May 2018.

MiFiD - Markets in Financial Instruments Directive
MiFiD is another piece of European legislation, and like the PSD (see above), there’s been two.  MiFiDII came into force in January 2018 and aims to bring more transparency to pricing in financial instruments (equities, futures, commodities, currencies, exchange traded products etc) and tighter standards in trading to protect and ensure fairness for investors.

P2P – Peer to Peer
In the financial services world, this cheeky little acronym usually refers to lending and borrowing between individuals, rather than a bank or building society. If you want to lend or borrow money, peer-to-peer websites will match you up with the right people.

FYI (for your information) our new research report on breaking customer inertia in financial services is available now.  IMO (in my opinion) it offers a valuable perspective on how customers are really feeling about innovation in banking. You can read the report here. And if you want to know what it means for your brand, please LBK (let Bertie know).