How to build your business case for open banking

This step-by-step checklist will help you take the first steps towards open banking in Australia.

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Preparing to handle and use consumer open banking data takes some preparation, so before you take your first steps, it's important to have a strong business case. TrueLayer's step-by-step checklist helps you to define how you want to use open banking data and how it aligns with your business goals.Follow this checklist to take your first steps towards open banking, including:
  • deciding how you plan to use open banking data
  • estimating costs
  • estimating how long preparation will take
Please reach out to us should you wish to discuss Australian open banking and how we might be able to help you.

How can I build my business case for open banking?

Define your first use caseOpen banking works by giving consumers control over their most valuable asset: their personal data. It means that in order to persuade consumers to agree to share their data, you need to demonstrate a use case that makes sharing it worthwhile. Key questions to ask when exploring which use case you might start with, include:
  • Why do you want to use open banking?
  • Do you have customers who will want or need it?
  • What value-added benefits will using open banking mean you can offer to your customers?
  • Do you have the technology capacity now or will you need to speak to a provider such as TrueLayer to help?
Decide what accreditation you needIn order to build new products and services using open banking data, businesses need to be accredited under one of the five access arrangements. Identifying which pathway will work best for your business is key, as you have a number of options open to your business, depending on where you are in the open banking process.
  • Full accreditation gives you access to consumers' open banking data without needing to go through an intermediary.
  • A sponsor-affiliate or Consumer Data Right (CDR) representative model offers companies an opportunity to partner with an accredited ADR like TrueLayer, which has years of experience working with the sponsor-affiliate model in the UK, to handle all data collection and consent requirements, and support compliance.
  • Trusted advisors such as accountants and lawyers will be able to access open banking customer data held by a business if their clients permit them to. They won't need to be accredited but do need to start thinking about the potential use cases they can offer their clients ahead of the completed Phase three rollout from Q2 2022.
  • And businesses can access insights about their customers that are gleaned open banking data without being accredited, by partnering with someone like TrueLayer.
Decide how to access Consumer Data Right (CDR) dataThe way you access open banking data may depend on which access arrangement you choose. You can build your own open banking infrastructure, which gives you complete control over the system, but comes with a cost of both time and money. Or you can partner with an open banking platform provider such as TrueLayer, if you decide that building a technology platform is not your core business proposition and you prefer the simplicity and cost reduction of a SaaS solution.

How much does open banking cost?

The cost of connecting to open banking data depends on the type of accreditation you wish to apply for, and the digital infrastructure you choose.It costs about $50,000 for legal and assurance reports and you may also be required to improve some internal processes, prior to obtaining final approval to join the scheme from the Australian Competition and Consumer Commission (ACCC). The key points to consider when determining how much accessing open banking data might cost are:Accreditation
  • Unrestricted Accredited Data recipient (ADR) registration is the highest tier of accreditation. It comes with infrastructure costs and compliance costs as you need to show in your application that you can technically comply with all requirements around handling consumer data, and have the policies and procedures in place within the business as well.
  • Being sponsored by an affiliate ADR is a lower cost solution, but still requires you to be approved as an ADR yourself.
  • Becoming a CDR representative does not require you to be accredited at all, but limits the kinds of product or service you can offer via open banking.
  • Trusted advisors do not need to be accredited but should begin thinking now about how they might access and use open banking data.
  • Using open banking insights doesn't require accreditation and offers limited access to specific, limited forms of open banking data.
Accessing open banking data – build or buy?Do you build your technical infrastructure yourself, or do you partner in order to access open banking data? For more information, see this guide on the 5 models for accessing open banking.

How long will it take to get access to open banking?

Obtaining unrestricted ADR accreditation is lengthy and can take as long as 4-6 months. If you choose to apply for full ADR accreditation, and are using a partner to provide the technology infrastructure, the process ideally will take:
  • Application preparation: 4-8 weeks
  • Assessment: 4-6 weeks
  • Conformance testing: 2-4 weeks
However, planning out your timeframe depends on a number of different factors, from your use case to your path to market to whether you partner or build your own open banking platform. This checklist will help you to decide what your timeline might look like.Discover your use case and readiness
  • Decide on your use case
  • Prepare a Readiness Assessment to ensure you have the business and technical processes in place to handle open banking data
  • Get business case approval
Choose your method of access
  • Choose your method of access: do you build it yourself or do you partner?
  • Start the accreditation process for your chosen go to market route with open banking
Go live
  • Undergo the ACCC onboarding process and pass the CTS (Conformance Testing Suite) technical hurdle
  • Integrate you API with those held by Data Holders
  • Go live with open banking
For more information on the Conformance Testing Suite, see this guide

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