The way Australians share account and transaction data will become much easier in February 2020 with the rollout of Open Banking through the Consumer Data Right legislation.
The first stage of Open Banking will involve the major four banks and the rollout will give consumers the right to control their data.
“Ultimately, Open Banking will lead to better financial and social outcomes for consumers by creating a level playing field between banks and other financial service providers,” said Kristofer Rogers, CEO of Split Payments, an Open Banking payments platform.
Four types of data will become available for consumers to share, including, product, customer, account and transaction data.
They will have the ability to choose who to share their data with and how it is used, as well as the ability to compare products and services.
“The key change with Open Banking is that it’s going to be easier to share this information – literally a few clicks,” said Kristofer.
Open Banking will create more transparency and comparison between different services, giving banks the opportunity to “deliver better customer outcomes,” said Kristofer.
Consumers, particularly those who work in the gig economy, can benefit from Open Banking when making lending and mortgage decisions.
“Open Banking allows lenders to dive deeper in to spending patterns and build a more accurate picture of a consumer’s ability to make repayments,” said Kristofer. This is instead of a reliance upon possibly infrequent payslips.
Byron Bay-based fintech, Split Payments, is the world’s first Open Banking real-time payments platform and has been a part of the ACCC beta testing phase of Open Banking in Australia this year.
Split Payments has also been involved in developing Open Banking and real-time payments standards in New Zealand as a founding member of Payment NZ’s API Centre that was launched earlier in 2019.
They have leveraged the advent of Open Banking to improve direct debit and payments technology.
Since launching in January 2018, Split Payments has processed more than 14 million transactions with an expected growth next year as Open Banking is introduced.
“We are already experiencing significant quarterly growth based on partnerships with major Australian corporates and fast-growing SMEs,” said Kristofer.
Open Banking is already popular abroad, particularly in the UK.
“We are excited and fully support the roll out of Open Banking in Australia over time,” said Kristofer.
You can read more about fintech here.