Ukraine Launches Open Banking Amid Challenges and Market Concerns

Open banking officially launched in Ukraine on August 1, 2025, marking a pivotal moment in the country’s financial landscape. This system is designed to facilitate secure data exchanges between payment service providers, including banks and non-bank financial institutions, allowing customers to share their financial information with third parties through specialized interfaces known as APIs. Although the framework for open banking is now in place, the full benefits may not be realized for some time due to ongoing implementation challenges.

Implementation Challenges and Regulatory Compliance

The launch aims to align Ukraine’s payment infrastructure with the standards of the Single Euro Payments Area (SEPA), facilitating smoother integration into the European Union. Despite the ongoing martial law, efforts to develop and adapt the necessary documentation have continued, ensuring that open banking was officially launched on schedule. However, the practical application of open banking will depend on the refinement of software systems and the licensing of third-party providers (TPPs) by the National Bank of Ukraine (NBU).

As per NBU regulations, banks and non-bank financial institutions authorized to open customer accounts must comply with the new requirements by January 1, 2026. Notably, penalties for non-compliance will not be enforced until August 1, 2026, providing some leeway for institutions to adapt. Currently, Ukraine has 60 registered banks and one financial company licensed to open and service accounts. Approximately 30 percent of these institutions have either completed or are in the process of software modifications necessary for compliance.

Market Reactions and User Concerns

While the framework has been established, many market participants express apprehension about the complex licensing process for TPPs. Fintech companies, in particular, face additional hurdles, as they must secure liability insurance—a challenge exacerbated by the lack of available insurance options for these specific risks. This situation requires either legislative changes or productive dialogue with the insurance sector to address these gaps.

The rollout of open banking has not yet fully informed end users of its potential benefits. Misinformation has spread through local media, with some reports incorrectly suggesting that customer accounts from various banks will merge into a single balance. This has caused concern among users regarding the security of their data and funds, leading some to request the disabling of an open banking system that is not yet operational.

Given the current landscape, it is unlikely that open banking will become fully functional by the end of this year. Experts predict that fewer than 10 market participants will secure licenses to access customer information via APIs within the next year.

To ensure the successful implementation of open banking, several key areas require attention: first, fostering interaction between market participants and regulators will be crucial for timely responses to necessary changes; second, enhancing financial literacy among the public is vital to encourage users to embrace the innovation; and third, increasing awareness of open banking processes among financial professionals will support the development of secure, commercial APIs and a robust ecosystem.

As Ukraine ventures into this new financial territory, the overarching goal remains clear: to leverage open banking as a means of driving innovation, diversifying financial services, and enhancing competition within the sector, ultimately benefiting all stakeholders involved.