Did the regulator just admit that banking is a mess?

I’ve just read the regulatory roadmap that the UK’s Financial Conduct Authority released this week and realised that it is less a neat plan and more a recognition that the current system is broken and we’ve run out of road with Open Banking.

For the past decade, Open Banking has been the poster child of innovation. APIs, data sharing, fintech apps… all good things. But in reality? It’s been partial, patchy, and largely limited to current accounts. Useful? Yes. Transformational? Not quite.

So now the FCA is basically saying: let’s stop pretending this is enough.

Open Finance is the next step … and it’s a big one. It means taking everything we learned from Open Banking and applying it across the entire financial system: savings, mortgages, pensions, investments, insurance. In other words, your whole financial life becomes data that can move securely, permissioned, but fluid.

That’s where things get interesting because, if this works, it flips the model.

Today, your financial data is locked inside institutions. Tomorrow, it follows you. That means services come to you, compete for you, and personalise around you. Smarter lending, real-time financial advice, automated switching, better pricing … in theory.

But here’s the catch: theory is easy. Execution is brutal.

The FCA roadmap quietly acknowledges a few uncomfortable truths. First, the infrastructure is a mess. The system is full of fragmented systems, inconsistent data, legacy spaghetti everywhere. Second, incentives are misaligned. Banks don’t naturally want to open up high-value data like pensions or investments. Third, consumers don’t fully understand or trust data sharing beyond simple use cases.

So, this isn’t just a tech upgrade. It’s a political, commercial and cultural battle.

The roadmap therefore takes a cautious, almost surgical approach.

Test real use cases first in SME finance, mortgages and lending, where there’s clear value. Build common standards so data actually means the same thing across institutions. Create governance structures, potentially a new industry body, to stop this becoming another fragmented free-for-all. And critically, balance innovation with trust, because one major data scandal kills the whole thing.

But here’s the part that some might miss. If Open Finance succeeds, it doesn’t just improve banking. It commoditises it.

When data flows freely, the advantage shifts away from the institution holding the balance sheet to the player delivering the best experience, insight, or outcome. That could be a bank or a fintech or a Big Tech platform or, increasingly, an AI agent acting on your behalf, and that’s the subtext the roadmap doesn’t quite say out loud: this is laying the foundations for agentic finance. A world where intelligent systems manage your money across multiple providers in real time, which brings us back to the earlier point about fragmentation.

Today, we’ve created a front-office spaghetti of apps, accounts and identities. Open Finance should fix that by standardising access. But if done badly, it could actually make it worse: more connections, more endpoints, more complexity.

So, the real challenge isn’t just opening data. It’s orchestrating it.

In short, the FCA roadmap is a necessary move but it’s also the start of a much bigger shift. One where control moves from institutions to individuals, competition intensifies, and the entire financial system becomes a programmable, data-driven network.

If they get it right, we move towards an intelligent financial ecosystem. If they get it wrong, we just end up with a bigger, faster, more complicated spaghetti mess.

Anyway, here is the whole report for those interested: