The Consumer Data Right (CDR) officially launched in Australia on 1 July 2020. With banking as the first sector to go live, Open Banking is here and is a game changer for the financial sector in Australia.
Though, change at this scale doesn’t happen at the flick of a switch. Australia’s Open Banking implementation timeline currently stretches to February 2022 with a number of key milestones and a lot of upcoming work still ahead.
The Open Banking implementation timeline
The below timeline shows the milestones for implementation as currently known. Each of the implementation milestones adds new products or Data Holders sharing their data.
What's included in the February 2021 CDR release?
As you can see in the timeline above, the February 2021 release consists of two things:
- Big Four Banks – Consumer Data phase 3
- Non- Major ADIs – Product Data phase 2
The Big Four Banks are the ‘Initial Data Holders’ and were the first to launch consumer data sharing in July 2020.
Although the Big Four have a lot of customers, the impact of Non-Major ADIs going live is not to be underestimated: there are over 100 Non-Major ADIs, with a lot of customers. The list includes banks like Suncorp, P&N Bank, Bank of Queensland and many more.
What's the difference between CDR consumer data and product data?
CDR consumer data is data related to a specific consumer and their financial products. Depending on the type of product this can include transaction data, account balances, direct debits, payees and more.
Consumers can consent to sharing this data with accredited third parties.
CDR product data is information about the financial products a Data Holder offers, like features, rates and fees. This information is also called Product Reference Data and is publicly available to anyone via APIs.
What are CDR product phases?
The implementation timeline refers to three phases, each of which includes a number of different products.
Phase 1 includes
Savings accounts, call accounts, term deposits, current accounts, cheque accounts, debit card accounts, transaction accounts, personal basis accounts, GST or tax accounts, personal credit or charge card accounts and business credit or charge card accounts.
Phase 2 includes
Residential home loans, investment property loans, mortgage offset accounts and personal loans.
Phase 3 includes
Overdrafts (personal and business), business finance, investment loans, lines of credit (personal and business), asset finance, cash management accounts, farm management accounts, pensioner deeming accounts, retirement savings accounts, trust accounts, foreign currency accounts and consumer leases.
If you want to know exactly which products are in scope and why, read the guidance for Data Holders on the CDR website.
When in February is the CDR release happening?
There’s no one specific date on which every non-major ADI will publish their product data, and every Big Four Bank will make the additional products available for sharing.
Some Data Holders started publishing mortgage product information as early as December last year (for example P&N Bank and Credit Union SA, using Frollo’s PRD Portal).
Though it’s expected that by the end of February, most of the scope will be implemented.
Have a look at the official CDR phasing table for more details
How does this impact consumers and businesses?
Although the February 2021 release isn’t as big as the July 2020 launch, or the November 2020 release (when joint accounts became available), there are some exciting things to expect.
The availability of up to date, accurate product information for mortgages and personal loans via public APIs is an exciting prospect.
It means businesses can use information like product features, fees and rates from over 100 Data Holders to help consumers get a better deal on their finances.
As the most active data recipient using CDR data, we have noticed that banks have struggled to get all the required data into the correct format. This may mean that ADR’s that follow will need to interpret the data before using.
How the Frollo app uses product information
Frollo has been testing the use of Open Banking product information in our budgeting app over the last few months, with a number of beta features:
- Real time product information showing rates, fees and features for accounts linked using CDR
- Product comparison showing the real impact of different savings account on your finances
- Next best action showing users when they’ve missed their bonus interest and what they need to do to receive it going forward
When each of the Big Four Banks has implemented the February 2021 scope, their customers will be able to share their data for products like overdrafts, lines of credits and cash management accounts with accredited third parties.
How the Frollo app uses consumer data
In the Frollo app this means consumers will get a more complete picture of their finances, as they’re able to view more of their financial products in the app.
Frollo uses this information to help people turn around their finances by giving them a full picture of their finances, providing them with insights and the tools to take action.