Open banking kicked off yesterday with just two accredited data recipients – organisations that can offer services using the consumer data right. Big bang it was not.
The two accredited organisations are Frollo and Regional Australia Bank. The Australian Competition and Consumer Commission said there were another 39 organisations going through the accreditation process.
Frollo is a fintech that has been operating in the Australian market since 2017, offering consumers a budgeting and personal financial management app. It also has B2B side to its business, offering financial institutions a developer portal that allows them to create their own apps.
Regional Australia Bank is a customer owned bank based in Armidale, New South Wales. It has assets of around A$1.5 billion.
Open banking is the first iteration of the consumer data right, which will eventually cover a number of industries.
Consumers have the right to direct their bank to share their data with an accredited data recipient. Typical accredited data recipients would include banks, non-bank financial institutions, providers of consumer finance apps and comparison sites.
Currently, only the four major banks are able to share their customer data. From July 1 customers can ask their bank to share their data relating to deposit and transaction accounts, and credit and debit cards.
From November, consumers will be able to share data relating home loans, investment loans, personal loans and joint accounts.
Other authorised deposit-taking institutions have until October to start meeting their product reference data sharing obligations.
The chief executive of banking software and services company Data Action, Nicola Burgess, said the company’s clients were busy implementing product reference data solutions. She said that when the system is fully implemented in 18 months, it would be a big change.
Burgess said some ADI clients would go live before their October deadline.
Frollo chief executive Gareth Gumbley said: “The next step for everyone is working out how to leverage the data for competitive advantage. From today, we’re moving into a world where we can give users a real-time view of their money and will soon be able to confidently move them to the best products available with a couple of clicks.”