What is Open Investment? Find out how it works!
Learn how Open Investment should work and what changes for investors
Announcements
Anyone who is a little more familiar with the world of investments has probably heard of Open Investment.
The financial market, especially the capital market, has attracted the attention of people who want to achieve their dream of financial freedom.
The creation of Open Investment will improve conditions for investors.
But what is this? How does it work in practice?
If you want to know more about the subject, keep reading!
What is Open Investment?
Open Investment is an initiative that provides for the authorization of data sharing between financial institutions.
In this way, some rules are established so that these institutions can share their financial products and have access to customer data from other institutions.
The entire process is carried out through a fast, practical and secure system. This makes it much easier to negotiate.
By sharing data, companies can offer more advantageous products and services, creating personalized offers.
In Open Investment, it is very likely that the process will be carried out through the sharing of data protected by the LGPD.
Like Open Banking and Open Insurance, Open Investment is also part of Open Finance.
What is Open Finance?
To help you better understand the concept of Open Investment, it is important to know what Open Finance means.
Open Finance, or Open Financial System, is the standard sharing of data about financial products, services and information by institutions authorized by the Central Bank.
By sharing data, customers can consult information from all participating institutions in a single location, in addition to having access to better conditions.
Open Finance brings together several initiatives for the digitalization of financial services and a wide scope of data, such as those related to the investment, insurance and pension markets.
How does Open Investment work?
Since 2018, ANBIMA (Brazilian Association of Financial and Capital Market Entities) has been promoting discussions on Open Banking.
This is because investment products from the financial and capital markets have already been included in the 4th phase of implementation of Open Banking.
The objective is to ensure that, at this stage, with additional information, it is possible to share data from financial institutions and products available to customers.
In this way, the consumer will be able to share some of their data with authorized institutions, completely online and securely.
With this knowledge, companies will create more personalized products with special conditions for each customer.
Participating institutions will also be able to share their products more efficiently so that interested parties who have not yet become customers can have access to such benefits and facilities.
Thus, each client, according to your profile, you will be able to better understand the investment opportunities available.
What should Open Investment include?
The tendency is for the scope of the products covered to prioritize those that have the greatest share.
Furthermore, it is also important to take into account the complexity of financial products.
When it comes to sharing data and information, more complex products bring greater challenges, as it is necessary to develop efficient standardization for sharing to be efficient.
According to the Central Bank's decision, investment companies will be able to register some financial products in the new system, such as:
• CDBs (Bank Deposit Certificates);
• RDBs (Bank Deposit Receipts)
• LCIs and LCAs (Real Estate and Agribusiness Credit Letters)
- Debentures
• CRIs and CRAs (Real Estate and Agribusiness Receivables Certificates)
• Public Treasury Direct bonds
• Shares of index funds listed on stock exchanges
• Investment fund shares
When will Open Investment start?
For now, the focus is on products and services relevant to retail.
The goal is to implement the project in three stages. The scale will help these institutions have enough time to think about the development. Check it out:
• Phase 1 – forecast for December 2021: For now, the institutions will make some data available, such as rates, product name, among others.
• Phase 2 – forecast for June 2022: In the second phase, consumers, if they wish, can authorize the sharing of their information, informing the product.
• Phase 3 – forecast for December 2022: Investors' transaction data may be shared.
Open Investment begins to be implemented from the fourth phase of Open Banking, which is complementary data.
What is the impact of Open Investment on the capital market?
For an investor to become successful, it is very important that he has knowledge in the area.
However, accessibility is a factor that also makes a difference.
A few years ago, it wasn't so easy to buy shares without paying brokerage fees. In addition to the fact that free online platforms didn't exist, people didn't have as much access to information about the financial market.
They were also afraid of investing their money and making a loss, as they didn't really know how the process worked.
But with the arrival of more accessible platforms and quality content about the world of investments, it has become much easier for beginner investors to take their first steps.
The more information, knowledge and accessibility, the better!
This way, investors will be more courageous to withdraw from savings accounts (which offer very low returns). They will then be able to invest in more advantageous products when it comes to profitability, especially when the focus is on the long term.
Everything indicates that the Open Investment initiative will reduce some barriers that still exist in the investment market.
Brazilians are increasingly aware of financial products that offer good returns.
However, the number of investors is still low, as many people still believe that savings are the best option for saving money.
Conclusion
There are several opportunities to expand the offering of investment products, which makes this process more transparent and secure, increasing solutions and competitiveness among participating financial institutions.
With the transparency of Open Investment, the capital and investment markets will take a big leap forward.
