Among the key trends in financial services in 2024 — as will be the case for the next year (and beyond) — has been the shift to open banking.
The premise and the promise of open banking is this: Individuals have the ultimate control over their financial data, including account-level data. They decide who gets to see that information — and how that information is ultimately employed by the financial services and products they are offered and use in everyday life.
The trend, then, is one toward personalization, where banks and FinTechs compete for customer loyalty, harnessing that data to extend credit and underwrite decisions in real time, or verify identities, or speed account-to-account payments.
APIs are at the center of it all, enabling the points of connection between providers and all of that permissioned data.
In the U.S., as PYMNTS Intelligence found earlier in the year, 46% of consumers said they were interested in using open banking for at least one product or service. But at the same time, as other reports showed, a commensurate percentage of FI executives said that the specter of fraud and other risks outweighed the benefits of providing those services.
The latter half of the year saw the Consumer Financial Protection Bureau set rules governing the collection and use of personal financial data in banking, in payment apps and in digital wallets. There’s legal wrangling over the rules, and the CFPB is looking next to create standards through a body of stakeholders that will help set a roadmap to accessing the data.
At a high level, the real-time insight that comes with transaction and account information can help lenders extend loans that are better underwritten and broaden financial inclusion. Sharing the data with third parties will also let customers pick and choose among providers while accessing that broad range of financial offerings through the points of contact they prefer.
Given the fact that only about 11% of U.S. consumers have used open banking payments, the upside is significant. There are some encouraging signs to help open the floodgates, as PYMNTS Intelligence has found that 82% said they have been satisfied with those experiences.
A key use case will be pay by bank, which enables money to move directly between accounts.
The PYMNTS Intelligence Report What Consumers Need for Pay by Bank to Catch On, in collaboration with Trustly, describes four consumer personas based on their interest in pay by bank: early adopters (6.4%), interested consumers (17%), intrigued consumers (22.4%), and resistant consumers (54%). Notably, younger generations are driving interest. Among Gen Z, 25% express eagerness to use pay by bank, while another 23% are intrigued. When consumers are presented with cash-back discounts or loyalty benefits, overall consumer interest surges by 72%.
We’ll also see further innovation in embedded finance as lending and other products pop up within non-financial applications. PYMNTS has detailed how 41% of FIs have already implemented embedded finance solutions. In addition, 79% of banks worldwide expect banking to become deeply embedded in daily consumer and commercial activities.
Intel’s new CEO, Lip-Bu Tan, is clear-eyed about the chipmaker’s many problems and the tough road ahead as he engineers a turnaround to revive this legendary Silicon Valley company.
“This is an iconic and essential company that is important for the industry and also to the United States,” Tan said in a keynote address at Intel’s conference in Las Vegas this week.
The nuclear physicist, who dropped out of the Ph.D. program at MIT, is best known for transforming Cadence Design Systems into a robust chip design and software company. He was also a board member at Intel.
“We fell behind on innovation. We have been too slow to adapt to meet your needs. You deserve better, and we need to improve, and we will,” Tan told his audience of customers and vendors. “Please be brutally honest with us.”
Tan called this juncture a “defining moment” for the legendary chipmaker.
Intel was once the world’s most valuable chipmaker — a crown that would go to Nvidia. With its “Intel Inside” branding, it was the first chipmaker to become a household name. In the 1990s, Intel and Windows became so dominant in PCs that the pair were called “Wintel.” Intel founder Gordon Moore’s “Moore’s Law” still stands 60 years after it was created.
Intel’s troubles began in the mid-2010s, when it started missing key product deadlines and struggled to advance to 10nm manufacturing, allowing rivals like TSMC and AMD to overtake it in performance and efficiency. Once the industry leader, Intel became hampered by internal bureaucracy, a rigid culture, and a hardware-first mindset that lagged behind a software- and artificial intelligence (AI)-driven future, while competitors like ARM and Nvidia thrived.
Intel also famously turned down Apple’s request to make chips for the iPhone, paving the way for Qualcomm. In the third quarter of 2024, Intel posted its largest quarterly loss of $16.6 billion, including a $15.9 billion charge to reflect lower valuations and costs to lay off 15,000 employees.
Now there are even reports of Intel as a takeover target — humiliating for a tech icon. “Intel Corp.’s fall from market dominance to takeover target is a tale marked by missed opportunities and rising expenses,” wrote Iuri Struta, senior research associate at S&P Global Market Intelligence, in a blog post. In 2020, Intel was the second most valuable chipmaker. As of last September, it had fallen to 14th place, he said.
Tan understands the enormity of his task to turn around Intel. “We have a lot of hard work ahead. We have fallen short of your expectations. I will pull together strong teams to correct the past mistakes and start to earn your trust,” he said. “I will not be satisfied until we delight all of you.”
Read more: Intel Faces Potential Breakup as Broadcom and TSMC Explore Deals
Tan faces a big challenge in reviving a company with decades of inertia to lead in a market that now moves at hyperspeed. His four areas of focus are: changing the culture, strengthening the core business, incubating and growing new business, and building customer trust.
Tan said he will bring Intel back to its roots: an engineering-focused company. He promised to meet with engineers even six to seven levels down from the C-suite to hear their ideas and unleash their creativity. Tan also promised to retain and attract key talent, which had been leaving Intel.
Tan said Intel needs to adopt a startup culture to innovate, where every day is Day One. His weekends are filled with meetings with engineers and software architects who have “brilliant” ideas and who “want to change the world. That’s when I get excited to work closely with them,” Tan said.
Tan also plans to simplify the way Intel works because “bureaucracy kills innovation.” The startup mindset will enable them to act with speed.
“We are operating in a very dynamic, fast-moving industry. Technology adoptions and disruption are accelerating faster than ever. This is being driven by the one transformational force called AI,” Tan said.
Intel will target three AI areas: cloud AI, generative and agentic AI, and physical AI such as robotics. To that end, Tan said Intel will spin off non-core business divisions but did not name which ones.
To right its operations, Tan said Intel must change the way it makes products. The company used to start by making hardware — chips — and then developing the software to make it work. “The world has changed. You have to flip that around,” Tan said. “You start with the problem, what you’re trying to solve. … Then we work backwards from there.”
Tan also addressed Intel’s product and foundry priorities. In client computing, he reaffirmed a commitment to innovation, noting the competitive landscape has shifted and Intel must not “stand still.” Pushing forward with AI-enhanced PCs, the company aims to ship its next-generation Panther Lake processors on its 18A process node later this year.
Perhaps most critically, Tan confirmed Intel’s ambitions to manufacture chips for customers around the world. “Foundry is a service business that is built on the foundational principle of trust,” he said.
At this stage in his career, Tan said he has been asked why he would take on one of the most difficult jobs in tech.
“The answer is very simple. I love this company,” Tan said, with tears in his eyes. “It was very hard for me to watch it struggle. I simply cannot stay on the sidelines knowing that I could help turn things around.”
Photo: Intel CEO Lip-Bu Tan. Credit: Intel livestream
