Banking Regulations 2020 in Australia: A New Era of Open Banking
As of July 1, 2020, Australian bank customers have gained greater control over their financial data, allowing them to share it with accredited third parties. This marks a significant shift towards open banking, enabling consumers to search for better deals on banking products and track their finances in one place.
What are the new regulations?
Under the new regulations, bank customers can grant permission to authorized businesses - including other banks, financial institutions, and organizations - to access their savings and credit card data. They can also share mortgage, personal loan, and joint account information since November 1, 2020. This data is protected by the Australian Competition and Consumer Commission (ACCC) rules.
Types of Data That Can Be Shared
The types of data that can be shared include:
- Personal details such as phone number, email, and address
- Account balances
- Product information like rates, fees, and features
- Transaction details including amounts spent
Benefits to Consumers
Open banking is expected to bring several benefits to consumers, including:
- Easier sign-up for new credit or debit cards
- Streamlined loan applications
- Budgeting tools for tracking spending
- Simplified switching between banks
The Consumer Data Right (CDR) Initiative
The CDR initiative, led by the ACCC, aims to extend open banking across industries, enabling secure data transfer economy-wide. The CDR is being developed in collaboration with the Office of the Australian Information Commissioner (OAIC) and the Data Standards Body (DSB).
A Shift Towards Digital Transactions
These changes mark a significant shift towards digital transactions, as Australia transitions from traditional ink-based transactions to electronic ones.