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Jordan’s Central Bank Launches Open Finance Initiative to Boost Fintech Growth

Amman, Jordan - The Central Bank of Jordan (CBJ) has launched an Open Finance initiative aimed at enhancing financial services and customer experience within the country. This move aligns with Jordan’s vision for economic modernization, fostering an environment conducive to innovation.

Key Pillars of Open Finance in Jordan

  • Target Financial Institutions: All banks and Payment Service Providers (PSPs) holding licenses in Jordan
  • Enforceability: Mandatory for financial institutions to allow Third-Party Providers (TPPs) access to customer data via APIs after obtaining customer consent
  • API Scope: TPPs can access various types of customer account data, including transaction data, account information, and other relevant data
  • Target TPPs: Account Information Service Providers (AISPs) and Payment Initiation Service Providers (PISPs)

Challenges Facing Open Finance Regulation in Jordan

  • Lack of knowledge and culture about open banking services
  • Technical know-how required to meet the requirements and expose APIs
  • Absence of standardised specifications hampers connectivity and collaboration with multiple banks and PSPs

Initiatives to Address Challenges

  • Open Finance Incubator: The CBJ is creating an incubator to nurture collaboration and provide a fertile environment for fintech startups
  • Task Force: A task force was formed to collaborate with the market and establish clear objectives for technical standards
  • Regulatory Expertise: Building regulatory expertise can foster stronger partnerships between financial institutions and TPPs

What’s Next?

  • By 2023, all banks and PSPs will be required to open Account Information and Payment Initiation services to authorized TPPs
  • The CBJ plans to collaborate with the private sector to define and establish a unified API standard
  • Expansion of Open Finance beyond banks and PSPs to include insurance, microfinance, and exchange services

Webinar: “Open Finance in the Middle East”

For more information on Jordan’s Open Finance framework and challenges and opportunities in the region, check out our latest webinar.