The expansion of the open banking regime, which has been in operation by the four major banks since 1 July 2020, builds on the number and type of account data that consumers can share under the Consumer Data Right (CDR).
Previously, CDR only applied to big four bank data on savings and transaction accounts, call accounts, term deposit accounts, current accounts, cheque accounts, debit, credit or charge card accounts, personal basic accounts and GST or tax accounts.
As of 1 November, individual customers of ANZ, CBA, NAB and Westpac can now share their data on their joint accounts, mortgages, mortgage offsets and personal loan accounts with an accredited recipient of the CDR.
As well as data about themselves, their business and their transaction details/account balances, major bank customers will now be able to provide consent for accredited data recipients (of which there are currently only six) to access the following data on their behalf:
- Customer data – such as contact details and occupation;
- Specific account data – including account numbers, interest rates on home loans, fees and applied discounts
- Authorisations relating to the accounts – such as direct debits, scheduled payments and saved payee details.
For joint accounts, the major banks must provide joint account holders with the ability to set their sharing preferences for the joint account and allow both account holders to share data on the account without each other’s additional approval.
Both joint account holders must inform the bank of this preference before data on the joint account can be shared.
For any data sharing process, both joint account holders will be able to see who data is being shared with, what type of data is being shared and for what period of time. This will be displayed to both joint account holders through their consumer dashboard with the data holder.
Certain closed accounts with the four major banks can also be shared with accredited data recipients.
It is hoped that the expansion will enable customers to gain access to more tailored services more efficiently.
The ACCC provided the following example: “If you choose to use an accredited data recipient which offers a budgeting service, this means that you can now provide consent for the budgeting service to collect and use your home loan account data, along with your other accounts like savings or everyday transaction accounts.
“This will give you a more comprehensive picture of how you use your money, so you can better control your budget.”
The regime will open up to non-major bank holders from 1 July 2021 for phase one products (such as savings and current accounts), expanding to mortgages and phase two products by 1 November 2021. However, non-majors can volunteer to share data earlier than this.
Several commentators from the banking industry have suggested that the CDR, and open banking regime more generally, will help foster a new era of lending – largely by removing cumbersome administrative processes that are often replicated several times in the mortgage process.
Find out more about the Consumer Data Right and how it applies to mortgages in Mortgage Business’ upcoming digital mortgages webcast, held live at 10.30 AEDT on Monday, 23 November.
Annie Kane is the editor of The Adviser and Mortgage Business.
As well as writing about the Australian broking industry, the mortgage market, financial regulation, fintechs and the wider lending landscape – Annie is also the host of the Elite Broker and In Focus podcasts and The Adviser Live webcasts.