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FinTech Australia Maps Out Future of Open Banking With New Report

Open banking is growing rapidly in Australia, with a 165 per cent increase in Consumer Data Right (CDR) participants, according to FinTech Australia‘s latest report.

FinTech Australia, the national association for the Australian fintech startup community, has unveiled the fourth edition of its Australian Open Banking Ecosystem Map and Report.

Supported by Mastercard, and in partnership with FinTech NZ, Payments NZ and Open Finance ANZ, the report reveals a growth in open banking use cases in Australia across lending, credit, and broking, as well as personal finance and payments.

The Consumer Data Right (CDR) has entered the consumer adoption phase in Australia, enabling individuals and organisations to securely share their data with trusted third parties for greater control.

Research findings

Data from the Australian Competition and Consumer Commission’s (ACCC) Provider Register shows a significant transition to open banking across the ecosystem, with 135 CDR representatives – a 165 per cent increase since December 2022 – and 96 active data holders.

Additionally, nearly all consumer bank accounts (99.74 per cent) are now connected to the ecosystem, positioning Australia for further adoption of open banking technologies.

Data recipients, which constitute 64 per cent of the ecosystem, are organisations authorized to receive consumer data upon consent and are crucial for creating data use-cases and promoting customer adoption.

Notably, 89 per cent of these data recipients use third-party intermediaries, such as outsourced service providers (OSPs), to access data via the CDR Register, highlighting the essential role these specialists play in driving participation in the CDR ecosystem.

The report highlighted a rise in use cases across diverse industries such as climate and sustainability, health, philanthropy, and hospitality, showcasing the significant growth and maturity of the Australian open banking ecosystem.

‘Period of innovation’

According to Rehan D’Almeida, CEO at FinTech Australia, with use cases starting to emerge, the challenge now is to encourage the capture and sharing of data on uptake and usage in order to quantify the impact of the CDR.

“Current cost of living challenges and higher interest rates make it more important than ever for us to see CDR enabled products in the hands of consumers at scale; helping them manage their finances, getting a better deal and saving them money. We expect the next 12 months will be a period of innovation and uptake as the ecosystem matures, with fintechs continuing to lead the way.”

Brenton Charnley, VP and head of open banking, Australasia at Mastercard, also added: “Mastercard has been powering and protecting its global payments network for more than five decades, and Mastercard’s open banking technology allows consumers to use their financial data for their own benefit to access innovative, new and improved experiences. Mastercard recognises the potential of the Consumer Data Right (CDR) in Australia to significantly empower consumers with more choice and control over their financial data.”

“Mastercard looks forward to the government’s response to the current consultations that focus on screen scraping and improvements to consent and data quality. These reforms will support both consumer and business adoption.”

FinTech Australia will partner with FinTech NZ, Payments NZ to expand the report to the Aotearoa New Zealand market. Future Open Banking Ecosystem Maps will provide a regional look at adoption of the CDR.

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