The Australian’s government announced an update on the Consumer Data Right on 9 May 2018. The updated Right will allow consumers to have a greater control over their data which are held by businesses. All consumers (individuals; or small, medium or large businesses) will be entitled to exercise the right in relation to the classes of data covered by the right. The Consumer Data Right will be rolled out on a sector-by-sector basis, starting with the banking sector, including Australian Fintech firms (aka ‘Open Banking’), with a phased implementation from July 2019.
Products in Scope
|Deposit products||Lending products|
Debit card accounts
Personal basic account
GST and tax accounts
Cash management accounts
Farm management deposits
Pensioner deeming accounts
Mortgage offset accounts
Retirement savings accounts
Foreign currency accounts
Lines of credit (personal)
Lines of credit (business)
Credit and charge cards (personal)
Credit and charge cards (business)
Asset finance (and leases)
The Consumer Data Right
A high-level summary of the right:
- Allowing consumers the right to safely access certain information about them which are held by businesses.
- Allowing consumers the right to transfer their data to accredited, trusted third parties of their choice.
- Allowing consumers to access their data in a readily usable form and in a convenient and timely manner.
- Allowing consumers to have better access to information on the products available to them.
Benefits of the Consumer Data Right and How It Affects Australian Fintech
1. Improve customers choice and convenience
As consumers are now able to share their data with accredited, trusted recipients, e.g. multiple financiers, comparison websites etc. This means consumers will have better visibility of the available products/multiple provides. This in turn increases the consumers’ ability to better negotiate pricing on the existing products or switch to one that offers a better deal.
2. Encourage the development of new products and services
By providing consumers access to more information on the products available to them, both traditional financiers and Australian Fintech firms will be forced to innovate products in the way to better meet consumers’ need and also offer better pricing.
Overall, the updated Consumer Data Right will bring many benefits to both consumers themselves, the Australian Fintech industry as well as the economy-wide.
Australian Fintech Growth, Opportunities & Challenges