Expect open banking to be a slow burn: Minister
With open banking set to begin in 2 ½ weeks, the government is keen to ensure expectations on initial uptake are realistic, suggesting it will be a “slow burn” given COVID-19 has put some fintechs under pressure and consumer awareness is low.
The banking sector will be the first to roll out the “consumer data right” (CDR), which allows customers to receive a secure copy of data they generate to share with other service providers. Open banking is scheduled to begin on July 1 with a limited data set, and the right will be rolled out next to energy and telecommunications.
About 10 fintechs are expected to be accredited by the Australian Competition and Consumer Commission to receive data from the big four banks when the regime begins. The ACCC is considering whether to allow intermediaries to receive data on behalf of fintechs unable to get accreditation, which would lift usage considerably.
Banks and fintechs are keen for a national advertising campaign to be launched to increase consumer awareness of the new infrastructure, which has been built, at significant cost, by the banks over the past three years.
Senator Jane Hume, Assistant Minister for Superannuation, Financial Services and Financial Technology, said participants should not expect any big bang when open banking began on July 1, with early adoption expected to be modest given the pressures the economy is facing from COVID-19.
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