1. Opt-in model for joint accounts
Probably the most impactful and necessary update in the short term, is the proposal to change the way data sharing works for joint accounts.
Currently the way this works is via opt-in. This means, before a consent for data sharing with a Data Recipient can be provided, both account owners need to have data sharing enabled in their Joint Accounts Management Service (JAMS), which they can find in their online banking portal.
For someone with a joint account who wants to link their account with an app using Open Banking, this practically means the following:
- They’ll go through the app’s consent flow and are redirected to their bank to select their account and complete the consent.
- After going through their bank flow, they won’t find their joint account in the account sharing list
- They’ll have to go to their online banking portal, find the JAMS section and request to enable data sharing on their joint account
- The other account holder will have to do the same
- Once that’s done, they can start over the account linking process in the Frollo app and select their bank accounts. This time their joint account should be visible
To remove this friction and improve the user experience of linking an account, the proposal currently being discussed changes this from an opt-in to an opt-out model. It is a significant improvement and one that will result in a far better user experience with a greater number of consumers accessing Open Banking.
The change would mean that joint accounts would be available, by default, for data sharing unless one of the account holders has disabled this feature in their online banking portal, using the JAMS functionality.
2. Draft CDR rules to broaden access arrangements
Currently, if you want to use Open Banking data there’s only one way: become an unrestricted Accredited Data Recipient and get full access CDR data across banking and other potential sectors like energy and telco.
Though, many use cases don’t require this much access, and the lengthy, costly process to become accredited can be a big hurdle for fintechs, lenders and brokers alike.
In the end it is the first reason which makes them shy away from trying to use the CDR platform. Other reasons include what value can be derived from the CDR – that’s a story for another day.
To make it easier to access CDR data for specific use cases, Treasury is now progressing with the development of draft CDR rules to broaden access arrangements. The key areas they’re looking at are:
- Providing for specific categories of ‘insights’ based on CDR data
- Alternative pathways for accreditation
- Principal-agent arrangements (sponsorship / affiliate model), where one accredited party can sponsor another – and be accountable for them
- Providing for CDR data to be shared with specified ‘trusted advisers’, eg. Brokers, accountants, lawyers.
Treasury has said these draft rules will be released soon for formal consultation and the Data Standards Body has commenced discussions with the CDR community on developing the supporting standards prior to the release of these draft rules.
Although it’s not clear yet when these rules will be implemented, we’re hopeful this will happen within the next 6 months.
3. Expansion of the CDR regime
Although the Consumer Data Right kicked off with Open Banking in 2020, the regime isn’t limited to financial information. It’s objective is to give consumers more control over their data and who they share it with, across many industries.
Earlier this month the Australian Government announced a significant investment in continuing and expanding the Consumer Data Right and accelerating the rollout across the economy by:
- Enabling data sharing in the energy sector in 2022
- Assessing and designating telco as a CDR sector in 2021
- Undertaking a strategic assessment in 2021 to deliver a roadmap for the economy-wide rollout of the CDR
- Expanding international engagement to export Australia’s data portability framework, promoting an interoperable and rules-based approach to international consumer data portability frameworks
- Providing offshore opportunities for Australian technology companies to scale globally
It’s exciting to see the CDR roll out in other sectors to take shape, as well as the beginnings of international interoperability – which we know is important to many Australians.
It’s why Frollo continues to invest in new products and services that make the most out of CDR.
The Frollo Open Banking platform
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