Data from the open banking platform Frollo, which surveyed 1,066 Australians, found just over half (51 per cent) of Australians trust their banks enough to share financial information with them by linking their accounts.
With the level of trust falling even further when it comes to sharing their financial data with brokers or financial advisers at 34 per cent.
The two biggest concerns consumers have are whether businesses will keep their data safe and whether they have their best interest at heart.
Frollo CIO Tony Thrassis said sharing financial information is a challenge for consumers, after years of being warned about the dangers of sharing their account credentials.
“This is why the government, banks and data recipients need to educate consumers on how open banking puts them in control of their data,” Mr Thrassis said.
“But words aren’t enough, we need to show them they are in control. That they actually decide how they use their own data, who they share it with and for what purpose.
“And where open banking is available, we need to get rid of less safe and transparent alternatives like screen scraping.”
When consumers were asked about six potential open banking cases, the report found most Australians see open banking products and services as useful, with two-thirds linking their bank account to share financial data.
The most useful service was using open banking to switch over payee and direct debit details to a new bank (bank switching) (68 per cent), a full financial overview (61 per cent) and streamlined mortgage applications (58 per cent).
Other insights revealed in Frollo’s report on consumer attitudes, Open Banking – The consumer perspective, found that when it comes to privacy, security and control over how they share financial information, privacy is rated the most important aspect (at 91 per cent).
This was followed by security, transparency and control over their data, which all ranked 88 per cent, while 70 per cent of Australians rated “ease of use” as important, and only 39 per cent said it was very important.
Millennials and Gen Z
Across the board, the younger demographic was more responsive to the changes open banking can bring, with the majority saying open banking was useful for a full financial overview (80 per cent), streamlined mortgage applications (78 per cent), and 76 per cent said it was useful when switching banks.
On the flipside, privacy and security concerns were less of a barrier for Gen Z and Millennials.