More than a year after Australia’s Consumer Data Right was launched with open banking, only a tiny proportion of consumers have used it and some potential commercial users are sticking with older ways of getting access to consumer data.
RFi research director Kate Wilson said about 2 per cent of consumers have used it, mostly to gain access to budgeting services, and a high proportion say they have no intention of sharing their banking data with anyone at this stage.
Wilson, who was speaking at a CDR webinar convened by RFi, said the industry has a lot of work to do to raise consumer awareness of what open banking is about and the benefits it offers.
CDR’s problems don’t stop there. Tonia Berglund, open banking leader at Envestnet Yodlee, said one of the company’s screen scraping customers, 86 400, has discussed its plans to move from screen scraping to open banking but is not convinced it is the right move.
Screen scraping is technology that has been around for over a decade. A consumer gives a service provider access to their bank accounts, super funds and investment accounts; data is “scraped” from those sites and aggregated by the service provider. There is a general assumption that open banking will supersede screen scraping.
Yodlee has been a leading player in the screen scraping business and more recently has been accredited as a data recipient under CDR.
Berglund said the problem for 86 400 and others is that the data available through open banking is not as extensive as the data that can be gathered using screen scraping. For example, superannuation account details cannot be accessed through open banking.
Jamie Leach, the regional head of financial data and technology industry group FDATA, said open banking would not catch up with screen scraping until a lot more data fields were made available under CDR, and that could be some years away.
Another area of concern is Treasury’s plan, announced in July, to amend the CDR rules to provide access to a wider range of service providers.
Treasury’s proposed amendments would introduce tiered accreditation: a CDR representative model, access by trusted professional advisers and an access model called “CDR insight”.
The idea is “to encourage greater uptake of the CDR by both participants and consumers, while maintaining trust in the security and integrity of the CDR system”.
Ben King, the head of public affairs at Finder, which is an accredited data recipient, said tiering would open up CDR by shifting the cost base from a big upfront spend required for accreditation to more of a user pays approach.
But he said the proposal was too complex, with too many models.
“How do you explain it to consumers and how do you frame the consent rules,” he said.