Tony Thrassis, CEO (Frollo)
After more than two years of tilling the soil, Open Banking is beginning to bloom. Early adopters are set to yield the gains, while new growth needs to be nurtured.
The Consumer Data Right (CDR) looks very different now than when it launched in July 2020 with the initial roll-out of Open Banking to the Big Four banks. Those initial seeds of an open data ecosystem have taken root and have grown substantially. In fact, they’re starting to blossom.
Frollo has been there from the beginning, and while we’re still doing more than 90% of all API calls, we’re excited to be joined by a growing list of businesses leveraging the opportunities that Open Banking presents. We’re seeing live use cases in personal finance management from P&N Bank, Beyond Bank and WeMoney. Finsure and Regional Australia Bank have lending use cases. And innovative businesses like Greener are an example of exciting new ways to utilise financial data to think outside the box and drive social change with their carbon tracking use case.
Educating consumers about safe and secure alternatives for data sharing has never been more important.Tony Thrassis (Frollo)
There are currently 77 businesses able to use Open Banking data, 44 CDR Representatives and 33 Accredited Data Recipients. We now have 114 banks sharing data for more than 30 different financial products, APIs are fast and reliable, and we’re getting rich data. All this activity reflects a level of maturity in the system that supports using Open Banking as the sole data source. And that’s a game changer for this space.
While there remains room for improvement, with some banks still having to work on data quality and reliability, consumers are already starting to reap the benefits; through streamlined lending applications and a complete picture of their financial situation. The expansion of the CDR to Open Finance will further increase coverage. New use cases supporting real-time and action-oriented notifications will further empower consumers to make smart financial choices.
Right now, businesses across the financial sector can use Open Banking data to drive innovation and growth. Early adopters like P&N Bank, Finsure, and Beyond Bank are all seeing the advantage of launching early, learning and grabbing a head start on their competitors. And it’s not too late to join them.
Meanwhile, as the government begins the roll-out of the CDR into the energy sector, the growing Open Banking ecosystem must remain supported by focusing on improving data quality and enforcing Data Holder standards for consumer experience and reliability. They also have an essential role to play in helping to raise awareness among customers about the many benefits of Open Banking. Especially in the wake of recent high-profile security breaches in other sectors, educating consumers about safe and secure alternatives for data sharing has never been more important. This will drive uptake and reassure businesses that might be on the fence about launching with Open Banking.
Because, if the growth in Open Banking in the past 12 months is anything to go by, the regime has the potential to completely transform the way consumers interact with and use their financial data.
This article is part of ‘The State of Open Banking 2023’, an industry report by Open Banking provider Frollo. The report provides a pulse check of the Australian Open Banking industry, interviews with thought leaders and an overview of exciting new use cases.