Open banking ready for lift off after hitting another milestone

From 1 February, there are three new ways businesses can access CDR data in Australia.

consumer data rights
Australia has hit an important milestone in its open banking rollout, as three new pathways become available for accessing Consumer Data Right (CDR) data.From 1 February 2022, the following access models will unlock the value of open banking data for even more businesses and consumers:
  • Sponsor–Affiliate
  • Trusted Adviser
  • CDR Insights
These new ways to access CDR data complement the existing access models: CDR Representative and Outsourced Service Provider or OSP (for more information on this access model, read our guide). There is now a wide range of flexible options for accessing open banking data in Australia, enabling even more businesses to provide customer experiences that deliver on the promise of open banking: choice, convenience, confidence and consumer control over their financial data.

The 3 new routes to market

So what are these new access models and who do they benefit? The Sponsor-Affiliate model will be key.
  • An Affiliate can access open banking data by asking their Sponsor – an entity like TrueLayer which holds unrestricted open banking accreditation – to collect the information on their behalf, with consumers' consent.
  • The Affiliate retains the hard-won relationship with their customers.
  • A Sponsor like TrueLayer helps with technical and regulatory compliance and provides training, while the Affiliate is responsible for how the data is used and disclosed and must gain accreditation from the Australian Competition and Consumer Commission (ACCC).
The next two models are expected to expand open banking ideas and practices into spaces outside the traditional banking sphere.
  • Trusted Advisers are people, such as qualified accountants or registered tax agents, who can use limited data with consumer permission to provide advice, such as mortgage eligibility or to prepare end of year accounts.
  • The CDR Insights model not only opens the door to open banking innovation, but to a wider use of CDR data. Third parties can ask Authorised Data Recipients (ADRs) like TrueLayer to use their insights into a person's finances in order to achieve a range of benefits for consumers, from verifying their identity to confirming they have enough cash in an account to make a purchase.
We expect the CDR Insights pathway will be interesting for all kinds of companies as a way to provide a secure, trustworthy means for authenticating a range of different transactions and requests. But CDR Insights and Trusted Advisor data is no longer protected by CDR rules once it leaves the open banking ecosystem, so it does require new consumer experience (CX) data standards. We expect the final standards to be released soon to support both models, following recent consultation on draft standards and updated accreditation guidelines from the ACCC.

But wait, there's more!

The first day of February is also the third and final stage of the phased rollout of open banking. Fintechs and non-major banks must now be able to offer open banking access for a range of new account types, including investment loans, overdrafts, lines of credit and cash management accounts. This will unlock benefits for lending, personal financial management and credit use cases. More information about the phased rollout is available on the CDR website.
This is not the end of the journey though. Key milestones to watch out for in 2022 include:
  • the introduction of single consent joint accounts to the open banking ecosystem (1 July)
  • the inclusion of business customers of non-major banks (November).
Many banks still have exemptions to give them more time to comply, but the list is rapidly shrinking: nearly 80 Authorised Depository Institutions (ADIs) have now joined the ranks of active Data Holders.Open banking in Australia is maturing. We expect 2022 to begin to showcase how the ecosystem can provide Australians with a new experience in choice and control over their financial data.
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