Australia’s ground-breaking Consumer Data Right (CDR) has created an economy-wide Open Data framework, starting with banking followed by energy and telco. The “big 4 banks”, namely Commonwealth, NAB, Westpac and ANZ, went live with Open Banking on 1 July 2020 and all non-major banks were mandated to follow on the one-year anniversary that we recently celebrated. Unfortunately, the majority of banks failed to come to the party on 1 July 2021. This is frustrating for the fintech community, although it has to be acknowledged that the availability of robust data APIs is a key success factor for the entire CDR regime, and hence it’s a question of time. Australia has 13 Accredited Data Recipients and, as more become active in the market with live use cases, consumers can start to get on board too.  It is, after all, the consumer’s data right. Who regulates Open Banking in Australia? The responsible regulator is the Australian Competition and Consumer Commission (ACCC) and the rules are set by the Treasury.  The official data sharing standards are called the Consumer Data Standards and have been developed by the CSIRO’s Data61.  The privacy requirements are covered by the Office of the Australian Information Commissioner (OAIC). How can providers go to market in Australia with Open Banking? To date, there has only been one route, which is to become an Accredited Data Recipient (ADR) which allows full access to CDR data across banking and other sectors. The Treasury recently released draft amendments which propose tiered levels of accreditation as well as an unaccredited model for access to data insights. These changes have been welcomed by market participants and are expected to become effective in due course, subject to a consultation process. The really interesting questions for providers looking at the Australian market are:

• What level of data access do I need?  And how do I decide the right accreditation strategy?
• Who are the right partners for me in the Australian market?
• When is the best time to go live with an active use case?

A key factor may be whether you have clients relying on you to directly access the data.  If so, you most likely need to go down the full accreditation route.  If not, you may consider one of the more cost- and time-effective options such as relying on a partner, like TrueLayer, to be your sponsor. How can consumers get on board with Open Banking in Australia? The success of this visionary data sharing regime will ultimately be measured by consumer choice, convenience and confidence. There is a five step process for consumers to use Open Banking in Australia:

1. Give consent to an Accredited Data Recipient (ADR) to access the data.
2. Verify identity using a single-use password.
3. A digital link to the existing Data Holder’s (DH) website or app allows the user to manage the data they are sharing.
4. The data is shared.
5. The consumer can now use the ADR’s service.

There is a broad range of banking data sets that consumers can request to share, including current accounts, savings accounts, term deposits and credit cards.  From 1 November 2021, home and personal loans are going to be added to the list and on 1 February 2022, a range of new financial products will be included, from overdrafts and lines of credit, to foreign currency accounts and business finance. Opening up finance in Australia With the first birthday of Australia’s CDR now behind us, the opportunity is here to launch the next stage of consumer-focused Open Banking use cases in Australia. Now is the right time to plan how you can take advantage of CDR data, ideating use cases that can benefit your business, and identifying your partners and channels to market. We’re looking forward to a brand new period in financial services embracing Open Finance and Open Data. [The author of this article is Brenton Charnley, Head of Australia, at TrueLayer]. [For more information, visit truelayer.com/australia]