NatWest has launched a new transaction categorisation service called Enriched Transactions, which is available to businesses, such as Account Information Service Providers (AISPs) and lending providers, to integrate with their apps and digital platforms.

By making the API-enabled service available to businesses, NatWest is the first UK bank to offer transaction categorisation as an extension to Open Banking APIs.

With customers’ consent, businesses can use Enriched Transactions data to give customers personalised insights – for example, tips on how to manage their budget or reduce their carbon footprint – helping customers gain more control over their finances.

The new service can also support businesses with affordability checks – for example, when checking customers’ eligibility for a loan or a mortgage. This could reduce the need for customers to upload payslips, helping them save time and reducing the risk of manual error. 

The new service works by automatically linking customer transactions to categories aligned to Financial Conduct Authority (FCA) standards, plus includes details on whether spending is ‘discretionary’ or ‘committed’. The service can also provide businesses with a 3-level breakdown of those categories – more than any other market offering – as well as deductions at source and the carbon score for each transaction.

NatWest’s analysis of customer transactions has shown that the service can categorise up to 89% of transaction types, with up to 98% of transactions being categorised accurately. This makes the service one of the most accurate categorisation tools in the market.

Barry Connolly, Managing Director Everyday Banking at NatWest Group, commented: “Helping our customers thrive financially today and tomorrow with simple and easy everyday banking is central to our strategy. We have helped over 3m customers by providing insights on how to improve their personal financial wellbeing, better manage their budget and build regular savings habits.  This is possible due to our focus on innovation and data led experiences like Enriched Transactions, where our high accuracy increases the ways we can help add value for our customers.”

Kevin Dearing, Head of API Commercialisation at NatWest Group, commented: “Enriched Transactions marks the start of an exciting new relationship between banks, customers and businesses that’s underpinned by customer consent, trust and security. The new service makes it easier for a wide range of businesses – from merchants to lending providers – to offer customers a more secure and efficient way of verifying their income when carrying out affordability checks. It will also enable businesses to provide NatWest customers with greater insights on their day-to-day spending and their carbon footprint.”

AISPs who want to use Enriched Transactions to categorise NatWest customers’ transactions can access the service through an extension to NatWest’s Accounts & Transactions API.

In addition, both AISPs and other businesses, such as lending providers, who want to categorise transactions for customers of all banks, can access the service through NatWest's Categorisation as a Service API.

In the months ahead, NatWest will be looking to sign deals with AISPs and other businesses who wish to use Enriched Transactions.

Fees and eligibility criteria apply for third parties using Enriched Transactions. Fees do not apply for customers consenting to their transactions being categorised. Customers must hold an eligible current account with NatWest, Royal Bank of Scotland or Ulster Bank (Northern Ireland) to consent to their transactions being categorised.