Banking has already progressed far beyond the days of customers going to the physical building to check their account balances. Now, we can check on our accounts from more than one bank and our credit card bills all in a single app on our mobile devices. Financial organizations can also access data on our consumer behaviors to provide personalized services.
Open Banking policy is enabling the acceleration of financial services and enhanced user experiences. It’s also why we are seeing the emergence of many new giants in the FinTech space. Take a look at Plaid, a startup that assists customers to build APIs that can link and manage multiple accounts, provide user identity authentication, and even analyze credit scores. As of today, Plaid has a valuation of $13 billion dollars, and the company’s clients including PayPal, Coinbase, and Microsoft.
The open data trend is now blowing over from financial services into the healthcare sector, and as the industry accounts for nearly 30% of global data, we can expect a huge impact. What’s more, estimates show that healthcare will be the largest growing industry between 2018 and 2025, charging ahead of both finance and manufacturing.
Open Banking policy will be the base of this growth in FinTech, and similar legislation for open data healthcare will drive the growth of that industry. In 2016, the US government passed the 21st Century Cures Act, a new raft of legislation that is going into effect this year. One key item of the legislation is the allowing of 3rd party companies to collect critical healthcare data via APIs. Medical information that would have previously stayed in the hands of hospitals can now be accessed from outside, thereby realizing its usability and giving patients ownership of their own data. I’m quite sure that once the benefits of this landmark legislation become manifest, countries across the world will follow the US.
As healthcare evolves from basic medical data analysis to services such as cross-platform APIs and wearables integrated with software to collect physiological data, it’s creating huge opportunities. Some good examples of startups making headway in this space are Cherubic portfolio companies ScienceIO and Health2Sync.
ScienceIO has developed an AI platform that transforms unstructured medical documents into contextualized information for research and analysis. The company has already analyzed over twenty million records and generated up to two billion data labels. Meanwhile, Health2Sync is a digital care tool that records data such as blood sugar, blood pressure, body weight, and daily activities to monitor the status of patients with chronic diseases.
While open data healthcare will transform traditional, fragmented medical services, there are still many challenges for startups in this space to overcome. The barrier to entry in the healthcare industry has always been very high due to factors such as government regulations and a complex stakeholder ecosystem that includes hospitals, clinics, insurance companies, patients, pharmaceutical companies, and medical device makers. There are also the complexities of health coverage in different counties to navigate.
However, it’s clear that the healthcare industry has come to an inflection point. Besides new legislation, the pandemic has greatly accelerated government and public acceptance of telemedicine, digital therapy, and remote health monitoring. As evidence of this change, venture capital investment in healthcare technologies in 2021 hit an unprecedented peak of $57 billion. I, for one, look forward to the day when I can not only check my account balance but receive personalized doctor recommendations based on my open medical data.