Finance is changing in Australia

Find out what open banking is and how it affects you.

What is open banking?

Open banking is about creating better consumer choice by giving people more control over their own financial data. Currently, banks and other financial institutions hold data regarding your transactions, accounts and finances. This can make it costly, difficult and time-consuming to select the best financial product and service for you and then switch to that product and service. Open banking will make this easier.

Why does open banking matter?

Having better access to your data will allow you to make better and more informed choices about the financial products that are right for you. It will also drive competition within the financial services sector, promoting innovation and allowing new and better products and services to be developed.

Who gets to share my data?

One of the most important decisions to come out of the open banking debate is that consumers own their data, not financial institutions. You will be in charge of the decision to share your own data, with whom and when. You own your financial data, not your bank.

Is sharing my financial data safe?

Safety has been the main concern of the open banking debate. The government has pointed out in its Issues Paper that banks take substantial steps to ensure customer data is kept secure and it will do the same when developing mechanisms for open banking.

As part of its review into the implementation of open banking, the government will consider "what controls may need to be in place to identify, assess, manage and mitigate risks related to data release and sharing as well as data collection and storage".

When is it happening in Australia?

The government has released an Issues Paper which will be open for public submissions until 22 September 2017. As part of the review into open banking, which will take place at the end of 2017, a timeline will be decided.

Is Australia the only country to do it?

No. The UK is currently pursuing mandated open banking, with the sharing of customer and transaction data via open APIs required to be in operation by 1 January 2018.

The European Union has also mandated open banking, with payment initiation and account data retrieval by third parties to come into effect in May 2018.

Various other countries, including the US and Singapore, are taking steps towards open banking, data sharing and open APIs.

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