In early September, Nubank announced that it has joined Open Finance 一 a Brazilian Central Bank system allowing institutions to share among themselves customers’ financial data.
The feature is available to all our 66 million customers that the bank has in Brazil. Open Finance is relevant because it allows bank customers to leverage their financial history to obtain the best options among all institutions in the system.
Do you want to know more about Open Finance, how it impacts the customer experience and how Nubank has developed its solution? Keep reading this article!
What is Open Finance?
Open Finance is a concept created to standardize the sharing of customer information between financial institutions. This is done securely through APIs (Application Programming Interfaces) in the institutions’ own channels.
By joining the Open Finance platform, Nubank allows its customers to manage their finances, personal credit, and account information. This initiative puts the customers in the center to control their financial life and also brings many benefits to Nubank.
With Open Finance, Nubank will learn about its customers’ financial behavior, credit limit needs, expenses, and products and services they use. This will allow the world’s largest digital bank to improve its portfolio even further.
Nubank’s sharing of banking data provided through Open Finance will follow all the guidelines set by the GDPR law and will have supervision and regulation provided by the Central Bank, to which only duly authorized institutions can adhere. Customers also have complete control over what they want to share and can revoke it anytime.
What are the benefits of Open Finance?
- The customer decides on their own which data can be shared with other financial institutions and for how long.
- This is possible through an application programming interface (API), – a technology that allows different platforms to communicate with each other.
- Customers have the freedom to gather their financial history and take it wherever they want.
- Customers don’t need to start a relationship with a new financial institution from scratch.
- The financial system becomes more transparent and free.
- Ultimately, better products and terms thanks to increasing competition among institutions.
How has Nubank developed its Open Finance solution?
In Open Finance, several working groups with participants from different institutions work on creating standards to cover everything from security to usability. An operation like that implies complex stakeholder management work. We needed to interact with several financial institutions to solve the problems we encountered along the way, unlike the Pix implementation process, where all our integrations are with Brazil’s Central Bank, our only stakeholder.
Nubank has robust tools for building applications. Here, we have monitoring solutions, CI/CD pipelines, and distributed tracing that are pre-configured for any new application we do. This all accelerated and always accelerates our development process. And in addition to that, we also have a lot of autonomy.
While developing our Open Finance solution, we had to deal with tools we were not used to utilizing daily. As communication with other institutions relies on mTLS, we chose to use NGINX to handle it, building upon the shared Kubernetes infrastructure we have at Nubank. Every time we have to make big decisions like that, we use the process of RFC (Request For Comments) in which we explain the challenge we are facing, the rationale behind our decision, and gather inputs from different engineers and other subject matter experts so we can make the best, well-informed decision.
All those tools and processes we already have in place make the deployment of new APIs extremely fast and efficient, with thorough monitoring out of the box.
What smart technical choices differentiated Nubank in the development process?
During the construction of Open Finance solutions, our team grew more than 100%. Thanks to the use of software engineering practices, such as pair programming and extensive documentation, we were able to onboard all these engineers in record time.
We used C4 models and ADRs (Architectural Decision Records) for all our relevant architectural decisions. This ensured that everyone on the team clearly understood how all the solutions connected and why they were designed as such.
That helped to avoid problems that some other institutions had in the beginning. In less than a day, we were able to take care of problematic situations.
Our structure is our biggest advantage. Here, we talk to engineers from other teams easily and manage to combine details quickly. When we start producing something, we have access to many metrics and parameters that help us to verify behaviors and make predictions.
What technical problems has Nubank solved?
Data visualization was a major issue inside and outside institutions. With Open Finance, we can visualize customer data across the banking system as a whole. We can update a lot of data from other institutions daily, with a huge update rate. This data freshness helps us make the best decisions in real-time.
We also run entirely in the cloud. When you work with a fixed technical park, there is a limit that cannot be exceeded. This doesn’t happen with the cloud – we can scale services, supply new requests and maintain the quality of the service. We also optimize costs, as this allows us to scale the operation as needed. We have processes that rely on Artificial Intelligence to ensure that we have the optimal infrastructure dimensioning.
Our approach to the GDPR regulation is also interesting: if we mark certain data as sensitive, it will be automatically overshadowed when we log it.
Once we were operating in production with other institutions, we knew we would only have a chance to test a few specific behaviors. With the help of Backend Driven Content, we were able to make changes in record time and push them to all users without having to release a new version of the app in the digital stores.
Metrics, techniques, parameters, and tools that guided Nubank
As Nubank operates in several countries, we always seek to develop solutions that enable the creation of new products. We have platforms with different purposes: some aim to enable multi-country solutions, and others solve specific domain problems, such as payments.
Our great advantage for Open Finance is the provision of a centralized view of our customers, making data available safely and effectively. Our operation is supported by monitoring tools that ensure that we are notified as soon as a problem occurs.
Each week, two people are designated as focal points for those alerts we receive. In operation, we collect infrastructure metrics, such as the number of requests, response time, memory and CPU used, and metrics of our application’s end-user experience.
This infrastructure is maintained by the Reliability team and supported by Analytics Engineers and Business Analysts. It gives us a global view of the health of our systems.
At Nubank, we are responsible for the applications we develop, from the conception to the operation of the systems.
Reviewed by Luciana Kairalla, Frank Fumarola, Cristiano Oliveira and Natalia Zonta