NAB open data testing delayed 'for months'

George Lekakis
Um, NAB, when will you be open for business?
National Australia Bank is struggling to get its open banking platform operational after conceding last night that it will not begin testing data sharing before September.

Banking Day received reports from other financial institutions yesterday that NAB was a non-starter on the first day of the open banking regime and a spokesperson confirmed that the country's third largest bank won't be sharing data for at least another 2 months.

"We continue to work closely with Data 61 and the ACCC to provide feedback into the technical standards and framework, particularly in the areas of security and usability," the NAB spokesperson said.

"We are planning a phased approach to the implementation of product reference data APIs starting with a testing phase in September 2019."

Australian banks are under pressure to roll out data sharing capability under the Morrison government's open banking agenda that is being overseen by the ACCC and the CSIRO subsidiary, Data61.

The delayed rollout of NAB's open banking system is an embarrassing development for the bank after it indicated only a few months ago it was "on track" to begin sharing product data with other financial institutions from 1 July.

"We're in good shape for that to occur," said NAB's head of digital, Jonathon Davey on 26 March.
"We're ready to pilot the proof of connectivity."

NAB's delayed testing of its open banking capability is likely to stoke concern among regulators and the banking industry that it might not be ready for the launch of customer data sharing in February next year.

Responsibility for major technology rollouts across the bank rests with Patrick Wright, NAB's chief technology and operations officer.

Since taking over the reins of technology functions in 2017, Wright has overseen a comprehensive cleanout of general managers across the division.

The former Barlcays America executive has moved swiftly and forcefully to centralise IT decisions - a move that has frustrated some staff working on technology projects at the bank.

NAB's failure to be at the starting gate for the first stage of open banking is likely to disappoint regulators such as APRA and RBA, who have been warning all major banks to deliver systemically important banking platforms in a timely manner.

Banking Day has been told by two sources that NAB froze development work on its yet-to-be-tested data sharing platform before the federal election on the expectation that the Labor Opposition would win government.

The Labor party signalled its lukewarm stance on the open banking framework when former digital economy spokesman, Ed Husic, told IT News in March that he was not persuaded it would deliver benefits for most consumers.

NAB's political miscalculation now has Wright and his chief information officer Yuri Misnik scrambling to catch up to their major rivals.

NAB's absence in the early stages of open banking is also curious, given that Misnik told a technology forum organised by Amazon Web Services last November that his bank's open banking capability was more "lean and efficient" than Westpac's.

"We're not planning to over achieve here and do more than Westpac, we actually think we're more lean and much more efficient," ZDNet reported Misnik telling the conference.

Those comments were ringing hollow yesterday as Westpac and Commonwealth Bank successfully began exchanging product data on their purpose built APIs.

Data flows between the two Sydney-based banks appeared to meet expectations on Monday, however there was some concern around connectivity with ANZ.

Banking Day understands that each of the Sydney-based banks had not received product data from ANZ, which triggered conjecture that the Melbourne bank had encountered technical problems.

An ANZ spokesman said the bank had received confirmation from Data61 that it was meeting its data sharing requirements.

"ANZ believes it has met the requests to be up and running today," the spokesman said.

Westpac used its readiness on the first day of testing to transmit a broader message about its commitment to open banking.

"Westpac is focusing on creating a trusted open banking regime that is secure, flexible and easy to use for all Australians," said Westpac chief data officer, Jamie Twiss.

"The pilot program will lay initial foundations to test the performance, reliability and security of the system before any personal consumer data is shared.

"It will also give software developers and fintechs a network of financial institution's data to build and improve financial services."