Open banking opens the way for neobanks
With the new open banking policy set to take effect July 1, neobanks could soon become the more popular choice for Aussies over the big four.
At the moment, it’s pretty tough for customers to access their financial information if they are with one of the big banks, making it hard to switch to a different institution for a competitive offer on financial products, like a home or personal loan.
This is where open banking comes in. Basically, these new regulations ensure that big banks give people and smaller banks greater access to their customer data, which can help Australians make a change more easily if they want to and ultimately improve competition in the banking sector.
While some people may simply make the switch to a smaller bank, others may use the opportunity to go digital and even take the leap to a neobank.
“Open banking will create new opportunities – some obvious, some we can’t even envisage yet – for neobanks and banks, but more importantly for their customers,” Executive Board Director and Co-Founder of Xinja, Van Le said.
“Open banking is the first cab off the rank in the open data movement, which marks a shift of control of personal data away from corporates, to the consumer – in a climate where there is an expectation that corporates – in this case banks – need to show they will use customer data in the interests of the customers, not just themselves.”
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