The Open Banking Review has released an issues paper for public comment explaining the context and background for the Government’s decision to introduce an open banking regime in Australia.
Open Banking refers primarily to giving customers greater access to and control over their own banking data. Open Banking enables the customer to direct that they, or third parties chosen by them, be provided with pre-determined parts of their banking data in a secure environment and in a prescribed way, so that it can be used to offer them new or better services, such as:
• more competitive banking products that better suit their needs, or banking products that would otherwise not have been available to them, or
• better personal financial management, accounting, tax and budgeting tools.
The term is also used to refer to enabling open access to banks’ data on their products and services.
With whom data can be shared and how data is used will be important. Enabling third parties (such as FinTech companies) to develop new banking products and services for banking customers may deliver better consumer benefits. The Review may therefore consider mechanisms by which third parties can be identified for suitability to participate in the Open Banking regime.
The issues are summarised as follows:
- What data should be shared, and between whom?
- How should data be shared?
- How to ensure shared data is kept secure and privacy is respected?
- What regulatory framework is needed to give effect to and administer the regime?
- Implementation – timelines, roadmap, costs
