open bank project (oct 2011)
DESCRIPTION
The Open Bank Project is a European lead initiative to open up financial transactions to much larger groups of individuals and raise the bar of financial transparency.TRANSCRIPT
Four main drivers:1) Malpractice, Distrust, Corruption and Fraud2) Missing Web 2.0 approaches3) Need disclosure / privacy options including Open Data4) Simple API protocols missing / lacking
InspirationAbout 5 Years ago I was
Thinking about
Corruption.....
..and a new type of bank..
Image source: John C. McCall and Christey Carwile, Other Africas, http://mccoy.lib.siu.edu/jmccall/otherafricas/
Then - Summer 2008 - Working in a theatre in Athens..
I said: “Lots of EU funded projects here.”
Set designer said: “Lots of corruption here!”
2 years later, Greece is in big trouble.....
Corruption and Fraud:
Over €30 Billion lost each year in Europe.
78% of European citizens think corruption is a problem in their own country.
Corruption - most talked-about global problem, according to a new BBC poll of more than 13,000 people across 26 countries.
'Corruption distorts markets and competition, breeds cynicism... undermines the rule of law... damages government legitimacy, and corrodes the integrity
of the private sector' - Ben W. Heineman Jr. and Fritz Heimann, The Long War against Corruption
1
Accounting / Banking Scandals, Corporate and financial malpractice
Some examples of failed banks: Bear Stearns, Merrill Lynch, Lehman Brothers, Northern Rock, Anglo Irish Bank, Glitnir...http://en.wikipedia.org/wiki/Accounting_scandals
2007–2010 Financial Crisis is the worse since the 1930's great depression...
Charitable Status?Just a few examples of recent scandals involving charities:
Aid Money. Aiding who?
The World Bank StAR initiative was setup to recover stolen assets.
http://www.cmi.no/publications/publication/?2752=corruption-and-fraud-in-international-aid-projects
http://www.cmi.no/publications/publication/?2752=corruption-and-fraud-in-international-aid-projects
2005 Paris Declaration.
2005 Paris Declaration.
Transparency International
Inequality +Distrust +Information Deficit
Corruption
“Corrupt acts are almost always hidden. If you are behaving honestly in the public or private sector, you will rarely have a need to hide your actions.“ - Corruption, Inequality, and the Rule of Law, Eric M. Uslaner
Inequality +
Distrust +Weak Law +
Information Deficit
Less Corruption
Timely TransparencyEmpowerment
Good for Democracy!
Public “Financial Debug Tools”Fraudulent and Corrupt behaviour would be easier to spot / less likely
to happen if the public had access to “Financial Debug Tools”
Banks not very Web 2.0 – Don't allow
easy integration with 3rd party tools and
services.
2
Most people use software provided by their bank to connect to their bank..
But services such as Twitter and Flickr prove the benefits of enabling 3rd party software to access services: The local monopoly is disrupted.
An “API” allows original, high quality applications to flourish.
e.g. this moneybunny app tags bank statements using emails from vendors for easier accounting. (currently using HBCI)
Financial Privacy / Disclosure shouldn't have to be strictly
ON or OFF
3
Traditional Savings Account
Current status:A Traditional Savings Account. No one else can (should) login.
Level of DetailLevel of Detail
Disclosure
Frequency
no sharing (full privacy)
share with tax office
share with company
share with friends
share with everyone (public)
yearly quarterly monthly weekly daily real-time
financial “comfort” indicator
account balance
sub category totals
some transaction details hidden
full transaction details
But what if you want to share with your accountant / tax office?
Level of DetailLevel of Detail
Disclosure
Frequency
no sharing (full privacy)
share with accountant / tax office
share with company
share with friends
share with everyone (public)
yearly quarterly monthly weekly daily real-time
financial “comfort” indicator
account balance
sub category totals
some transaction details hidden
full transaction details
Current Account shared with accountant
What if a Company wants to easily share its financial transactions with its board / share holders / team?
Level of DetailLevel of Detail
Disclosure
Frequency
no sharing (full privacy)
share with tax office
share with company
share with friends
share with everyone (public)
yearly quarterly monthly weekly daily real-time
financial “comfort” indicator
account balance
sub category totals
some transaction details hidden
full transaction details
Company
● Could access a better choice of financial software applications, platforms and services.
● Could grant read access to key stake holders.
● Could enable its IT staff to more easily write and integrate secure applications across multiple bank accounts in different countries.
A Company
NGO / Charity
An NGO or Charity could practice public transparency by revealing transactions to the web in real time.
Level of DetailLevel of Detail
Disclosure
Frequency
no sharing (full privacy)
share with tax office
share with company
share with friends
share with everyone (public)
yearly quarterly monthly weekly daily real-time
financial “comfort” indicator
account balance
sub category totals
some transaction details hidden
full transaction details
● Can better engage key stake holders in their financial affairs.
● Receive comments, better deal suggestions and fraud alerts from the public.
● Can demonstrate accountablilty, transparency and value for money.
● Can better integrate with financial systems and networks.
A Charity
• “The Public donates, The Public sees.”
Publicly Funded Projects● Citizens pay, Citizens see..
- where their money goes in real time.
● Foster greater trust and engagement in Governments / EU.
● Crowd source alerts of fraudulent behaviour.
•“High Trust – High Distrust”
Lewicki, McAllistair, Bies 1998, Trust and distrust: new relationships and realities.
Existing Protocols:• HBCI/FinTS in German speaking countries (and OFX in the U.S.A.)
BUT..
• Non standard server side implementations make client implementation difficult.
• Development and bug fixing is slow
• No 3rd party authorisation.
• Full login credentials required, so the user grants more access rights to the 3rd party web application than needed. Ths violates banks' Terms of Service
• Not RESTful / Not worldwide / Not Open Source
The Open Bank Project will leverage existing protocols where they exist and provide connectors for them.
4
Banks and their customers benefit from an APIAn Open Source RESTful API gateway would greatly increase the choice of tools, software and services available to a bank's customers in a trustworthy, secure manner...
This is good for the bank – and its customers!
Greater application diversity, originality, choice, support options etc.
An Open Bank – all accounts open to the Public
- Attractive to those engaged in transparency- New business models and communities emerge- Transactions of the bank itself are transparent- Community can make “better deal” suggestions- Open Source software is used and created, further promoting a healthy financial technical ecosystem.
Federated trust networks
Data
Organisation
The Open Bank Project Aims to:● Open transaction data to larger groups of people and software applications● Raise the bar of financial transparency
● Enable more enjoyable and productive ways to access transaction data
How?• Apply Web 2.0, Secure Internet Standards, RFC
● Use and produce Open Source technology
● Crowd Source: ideas, feedback, bugs + trust networks
(Examples: Wikipedia, Flickr, Facebook, Apache, Postgres, Firefox....)
Research Topics
●Multi peer trust networks (Know your customer) ●Generic auth connectors●Secure Actor based systems (Scala)●DSL's●Multiple identity authorities●Access control.●Socio questions: privacy, legal,●data hashing.
Get input from other innovations such as Bit Coin, Open Coin and other research projects.
Comifin
PoSecCo
ABC4Trust
ENDORSE
Picos
Parsifal
Awissenet
Inco-Trust
Spacios
Some Partners- Raul Soriano, PROS, Spain- Atos Origin, Spain- Banca Civica, Spain
and more...
TESOBE, Berlin, Germany
Fidor Bank AG, Munich, Germany
ATB, Bremen, Germany
CONTEXTIS , London, UK
CNRS, France
Sigma Orionis
Team
Simon Redfern (Founder). Web Applications / Database Engineer, Berlin
Ismail Chaib, TESOBE
Jan Bölsche. Independent Software Architect, Berlin
Bruno Girin. Independent Internet Banking Solutions Architect, London
Florent André. Software Engineer (member of Apache foundation) Emmanuel Lecharny, Software Engineer (member of Apache foundation)
In Conclusion:
The OPEN BANK PROJECT creates a radical ‘opening’ of banking transactions. It promotes both financial transparency and security by engaging public vigilance (‘many eyes’), increasing customers’ confidence in adopting organizations and their financial institutions.
Contact
Simon Redfern
simon AT tesobe DOT com
http://www.openbankproject.com
@OpenBankProject