Government injects $44.6m to accelerate open banking rollout
The Federal Government will commit $44.6 million from the 2018 Budget to establish a Consumer Data Right (CDR) framework, expected to fast-track the rollout of open banking.
Treasurer Scott Morrison will head the development of the CDR with consideration of the Government’s response to recommendations from the Open Banking Review.
Proposed by the Government in late 2017, the open banking regime will allow customers to direct their bank to send data to another provider, promising to reduce the inconvenience and costs associated with account switching.
Morrison said the CDR will give small businesses and households “more control, more choice, and better deals”.
The 2018-2019 Budget includes a $44.6 million investment between 2018 and 2022 to establish the CDR, which will allow Australians to obtain more control over personal data.
A CDR Fact Sheet released by the Treasury this week outlined several benefits that will arise under the framework. This includes further developments in banking applications capable of analysing customers’ spending and repayment behaviours on their credit card “to identify the best product for an individual, saving them money on high fees or obtaining better interest rates".
The Australian Competition and Consumer Commission (ACCC), the CSIRO and the Office of the Australian Information Commissioner will form a team to co-develop the CDR.
Fintech Australia chair Stuart Stoyen said the Open Banking Regime will leapfrog Australia to the forefront of the open banking revolution, creating opportunities to export our knowledge to the rest of the world.
“We’ll see an export of Australia’s knowledge, experience and expertise on open banking, and that will create a number of downstream exporting opportunities for Australian companies to export some of those products and services,” he said.
“Open banking is about driving better outcomes for all Australians, whether they’re consumers or small businesses in financial services,” Stoyen added.
A National Data Commissioner (NDC) will be appointed to oversee and monitor the CDR, with new legislation streamlining how the Government will reuse public data, which will be subject to safeguards and privacy considerations.
"The NDC will be responsible for developing guidance on data sharing arrangements; monitoring and addressing risks and ethical considerations on data use and managing the process for high-value datasets", the Budget papers stated.