Open banking rollout pushed back to allow for testing
Consumers may not be able to benefit from the open banking system until February 2020.
The Treasury has released a revised timeline for the rollout of open banking in Australia, the most notable change being that the initial 1 July 2019 start date will now be the start of a beta test of the system rather than the actual start of data sharing capabilities for consumers. From this date, the robustness of the open banking system will be tested. The first set of consumer data will now become publicly available no later than 1 February 2020.
Open banking is the first implementation of Australia's Consumer Data Right and will give Australians control over their financial data. When the open banking system is fully implemented, consumers will be able to direct institutions to share their data to be able to better compare prices and switch between providers.
The pilot test of open banking will be run by the Australian Competition and Consumer Commission (ACCC) and Data61, and will test the security, performance and reliability of the system. To prepare for the beta test, the Big Four – CommBank, ANZ, Westpac and NAB – will be required to have all product data for credit and debit cards, deposit account and transaction accounts available. According to the Treasury, the ACCC and Data61 will work closely with other banks that have expressed interest in participating in the pilot test. Consumers and fintechs will also be invited to participate.
As per the original timeline, product and consumer data for mortgage accounts will also be made available on 1 February 2020. While other banks originally had a 12-month delayed timeline to have their product data available, this has not been adjusted as per the newly revised timeline. Other banks will still need to provide access to product, account and transaction data for credit and debit cards, deposit accounts and transaction accounts by July 2020. This means that consumers can expect all banks to have this data available to them in 2020: by 1 February 2020 for the Big Four and by 1 July 2020 for other banks.
The revised timeline follows the release of the rules outline for the Consumer Data Right by the ACCC on 21 December 2018. The Consumer Data Right bill is scheduled to be introduced into parliament next year. After it becomes law the final rules will be put in place.
ACCC Commissioner Sarah Court said the release of the rules outline was an important step in making the Consumer Data Right a reality.
"The Consumer Data Right will initially apply to banking data, giving consumers and small businesses the choice to securely share data with trusted third parties," she said.
"We expect the Consumer Data Right to open up a range of innovative and cheaper financial services to consumers because it will overcome some of the problems caused by the lack of transparency around current market offers and the concentration of consumer banking data in the hands of the banks."