In-House vs Outsourced Open Banking Integration: Costs, Security, and Speed

Before launching your first open banking integration, one decision defines your timeline, cost and compliance burden: should you build it in-house or outsource it to a regulated API provider?

Both approaches let you connect securely to banks and access real-time financial data. But they differ significantly in development cost, security ownership, and speed to market. In this guide, you’ll learn how each option works, what resources each demands, and how to decide which model aligns with your organisation’s goals.

As of March 2025 there were 13.3 million active users of open banking in the UK and 31 million open banking payments in that month alone.

This shows the growing scale and commercial importance of an effective open banking integration.

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What Is an Open Banking Integration?

An open banking integration is the technical connection between your application and banking systems that allows you to securely access and use customer-approved financial data.

It typically includes:

• Account Information Services (AIS): retrieving balances, transactions, account identifiers.
• Payment Initiation Services (PIS): initiating payments directly from bank accounts.
• Data enrichment and normalisation: converting raw bank data into usable insights for analytics or decisioning.

A complete open banking integration involves multiple layers — API connectivity, user consent flows, Strong Customer Authentication (SCA), data normalisation, and regulatory compliance. How you build and manage these layers determines your cost, timeline, and level of control.

The Two Integration Models Explained

Approach	What It Means	Best For	Typical Timeline
In-House Build	Your team develops and maintains direct connections to individual banks, handles licensing, and controls the entire open banking integration stack.	Large, regulated institutions needing full ownership.	6 – 12+ months
Outsourced API Platform	You use a third-party provider that already has licences, bank connections, consent flows, and manages most of the infrastructure — you integrate via their API.	Start-ups, SMEs, or non-regulated firms seeking faster deployment.	2 – 8 weeks*

Key takeaway:

• Building in-house provides maximum control but requires more time, resources and regulatory burden.
• Outsourcing your open banking integration offers speed, lower upfront cost and lighter compliance burden at the expense of some control.

Cost Comparison of Open Banking Integration

Building and maintaining a compliant open banking integration involves more than just development time — it affects your long-term operating model. Below is a clear breakdown of how the two approaches differ financially.

1. In-House Open Banking Integration

Creating an in-house open banking integration means investing in every component yourself from infrastructure to compliance oversight.

Cost Structure:

• Initial setup: recruitment of backend engineers, compliance officers, and security experts.
• Licensing: applying for FCA authorisation (AISP/PISP), a process that often takes months and incurs legal costs.
• Maintenance: each UK bank updates APIs periodically; your team must test, patch, and redeploy.
• Security and audits: periodic penetration testing and external reviews add to annual spend.

Impact:
While this approach offers total control, the first-year cost can be 5–7 times higher than using a pre-licensed provider. It only becomes cost-effective for large institutions with continuous transaction volumes and long-term ROI targets.

2. Outsourced Open Banking Integration

With an outsourced provider, you connect via a pre-built, compliant API gateway that already meets UK regulatory standards.

Cost Structure:

• Setup: often zero or minimal — setup is handled under a usage-based model.
• Pricing model: predictable monthly or per-transaction fee, making budgeting straightforward.
• Hidden savings: no separate costs for data normalisation, SCA logic, or audit compliance.

Impact:
For most UK businesses, outsourcing an open banking integration reduces development and maintenance costs by 50 – 70 % in the first year while improving deployment speed and uptime.

Security & Compliance in Open Banking Integration

Security is not optional, it’s the foundation of every open banking integration. How you approach it depends heavily on whether you build or outsource.

Aspect	In-House Build	Outsourced Platform
Regulatory Coverage	Requires your own AISP/PISP licence and ongoing FCA audits.	Operates under the provider’s existing licence and compliance framework.
Data Protection	Must implement encryption, key management, and GDPR processes internally.	Provider handles encryption and secure consent flows under FCA and PSD2 requirements.
Authentication	You design and maintain Strong Customer Authentication (SCA) for every bank.	SCA handled by provider with pre-tested redirect and fallback flows.
Monitoring & Reporting	Continuous transaction monitoring and audit trail management are internal responsibilities.	Real-time reporting and audit logs are integrated within the provider’s platform.

Bottom Line:
An in-house open banking integration offers deeper visibility and governance but significantly increases compliance workload. An outsourced model delivers faster certification, shared accountability, and peace of mind backed by audited infrastructure.

Speed to Market with Open Banking Integration

Speed is often the deciding factor when selecting between an in-house build and an outsourced provider.
A slow rollout can delay partnerships, stall customer onboarding, and reduce ROI, especially when financial products depend on live data access.

Stage	In-House Timeline	Outsourced Timeline
Bank Connectivity	3 – 6 months per bank (depending on API maturity)	Immediate access via unified API connections
Consent & Authentication (SCA)	4 – 8 weeks of custom UX and redirect development	Pre-built hosted or white-label consent flows
Compliance & Licensing	6 – 9 months for FCA approval and security validation	Operate instantly under provider’s existing licence
Full Deployment	6 – 12+ months	2 – 8 weeks

Observation:
An outsourced open banking integration can go live up to 5 – 6 times faster than an internal build, mainly because all critical dependencies from consent screens to security audits are pre-certified and maintained by the vendor.

Fast deployment not only shortens time-to-revenue but also gives your development team more bandwidth to focus on product innovation rather than compliance overhead.

Scalability & Maintenance

As usage grows, maintaining an open banking integration becomes increasingly complex. Each connected bank can update APIs, modify consent rules, or introduce new data structures — all of which demand continuous upkeep.

In-House

• Requires a dedicated technical team to monitor API version updates across all UK banks.
• Every change triggers new test cycles and regression checks.
• Must handle uptime, latency, and failover logic independently.
• Scaling into new regions or use cases (like payments or affordability checks) often means starting development over.

Outsourced

• The provider automatically updates endpoints, data schemas, and security certificates.
• SLA-backed uptime and real-time monitoring come standard.
• Expansion to new banks or markets happens through configuration, not new builds.
• Consistent developer experience across institutions — one API, many banks.

Result:
An outsourced open banking integration scales linearly with business growth, while an in-house setup scales exponentially in complexity. Over time, maintenance can consume 30 – 40 % of engineering capacity if handled internally.

Decision Framework: Build vs Buy Your Open Banking Integration

The right model depends on what matters most to your business — control, speed, cost, or compliance coverage.

Priority	Best Fit	Why It Works
Faster Go-Live	Outsourced (Finexer)	Platforms like Finexer deliver fully compliant open banking integration within weeks, connecting to 99% of UK banks instantly with no setup cost.
Regulatory Control	In-House / Outsourced (Finexer)	Building internally gives full audit oversight, but Finexer offers a similar level of transparency through detailed reporting, API access, and compliance documentation under FCA authorisation.
Lower Upfront Cost	Outsourced (Finexer)	Finexer’s usage-based pricing model removes heavy licensing and setup expenses, letting firms scale cost-efficiently as they grow.
Custom UX / Data Ownership	In-House / Outsourced (Finexer)	Firms can maintain full UX control through Finexer’s white-label APIs, achieving the same customisation benefits as an internal build without the compliance burden.
Long-Term Predictability	Outsourced (Finexer)	Finexer provides SLA-backed uptime, real-time monitoring, and consistent API stability, ensuring predictable performance across every integration.

Rule of Thumb

If your goal is faster deployment, zero setup cost, and built-in FCA compliance, an outsourced open banking integration with Finexer is the smarter route.
If your business demands complete regulatory autonomy and has long-term technical resources, building in-house can be justified, though it comes with higher cost and longer timelines.

Summary

Choosing between in-house and outsourced open banking integration is ultimately a trade-off between control and efficiency.

• In-house: offers control, but introduces heavy maintenance, licensing delays, and compliance risk.
• Outsourced: with Finexer, you gain instant access to UK banks, 3–5 weeks onboarding support, and a secure, FCA-authorised API layer that scales with your product.

For most UK businesses, partnering with Finexer delivers the best balance of speed, security, and savings, enabling you to focus on innovation rather than infrastructure.

* Estimated timeframe. Actual duration may vary depending on integration complexity, bank coverage, and internal testing requirements.