What Is Open Finance?
Open Finance (formerly known as Open Banking) is a regulatory framework established by the Banco Central do Brasil that allows customers to securely share their financial data across different institutions — with their explicit consent. Rolled out in phases starting in 2021, Open Finance is reshaping how banking apps work and what they can offer users.
In simple terms: your financial data belongs to you, and Open Finance gives you the tools to use it across multiple banks and fintech services simultaneously.
How Open Finance Works
The system is built on standardized APIs (Application Programming Interfaces) that allow authorized institutions to exchange data securely. Here's the basic flow:
- You log into an app or service that participates in Open Finance.
- You grant explicit consent to share specific data from one institution with another.
- The receiving institution accesses only what you've authorized — nothing more.
- You can revoke consent at any time, and the data sharing stops immediately.
What Data Can Be Shared?
- Account data: Balance information, transaction history
- Credit products: Loan terms, credit card history, credit limits
- Investment data: Portfolio details, fund performance
- Insurance products: Policy details and premiums
- Pension/retirement data: Contribution history and projections
How Open Finance Is Changing Banking Apps
Consolidated Financial View
With Open Finance, some banking apps now allow you to see accounts from multiple banks in a single dashboard. Instead of checking three different apps, you get a unified picture of your complete financial life in one place.
Better Credit Offers
When you authorize a bank to view your full financial history — even from competitor institutions — they can make more accurate lending decisions. This often means better interest rates and more tailored credit offers for consumers with good financial behavior who previously only had a relationship with a smaller institution.
Smarter Spending Insights
Fintech apps built on Open Finance can analyze your complete spending across all cards and accounts, delivering more accurate budgeting insights, personalized financial recommendations, and better savings plans.
Portability and Competition
Open Finance increases competition among financial institutions. Banks can no longer rely on "lock-in" — if a competitor offers a better rate or product, switching (or using multiple providers simultaneously) becomes frictionless. This benefits consumers directly.
Is Open Finance Safe?
Safety is a top concern, and the framework was designed with strong protections:
- All participating institutions must be authorized by the Banco Central do Brasil.
- Data is transmitted using bank-grade encryption standards.
- Consent is always explicit and documented — no data is shared without your action.
- You can view and revoke all active consents directly within your banking app.
- No passwords are ever shared between institutions — only tokenized data access.
How to Use Open Finance in Your Banking App
- Open your banking app and look for an "Open Finance" or "Compartilhamento de Dados" section.
- Review what institutions and data types are available to connect.
- Grant consent for the specific data share you want to enable.
- Confirm via your app password or biometrics.
- Access your consolidated data in the designated dashboard section.
The Future: From Open Banking to Open Finance to Open Data
Brazil's framework is already expanding beyond banking into insurance, investments, and pensions — making it one of the most comprehensive Open Finance ecosystems globally. The next stage, "Open Data," will extend consent-based data sharing even further, enabling more personalized products across the entire financial services sector.
Understanding Open Finance today puts you ahead of most banking app users and helps you make smarter decisions about which institutions and tools best serve your financial goals.