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Budget 2018: Government response to the open banking review

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The Hon. Scott Morrison MP Treasurer


Wednesday 9 May 2018


The Turnbull Government will act to improve customer outcomes and increase competition in the financial sector by implementing the recommendations in the final report of its independent Review into Open Banking.

Implementation will be phased in from July 2019, paving the way for the introduction of the Government’s Consumer Data Right in the banking sector.

Open Banking has the potential to transform the competitive landscape in financial services and the way in which Australians interact with the banking system.

It will give banking customers greater access to the data their banks hold on them and the ability to direct that it be safely transferred to trusted and accredited service providers of their choice.

Customers will be able to use their new data rights to find better deals on their credit cards, mortgages and other banking products. Comparison services will be better able to assess the value and suitability of all available products, taking into account the individual circumstances and needs of the customer. This will help to break down barriers that see customers staying with their banks even when there are better deals elsewhere.

Open Banking will also allow entrepreneurs to develop new services and products tailored to customers’ needs, disrupting those existing business models within the banking sector that do not put customers first.

Importantly, the Government has committed to the blueprint proposed by the Review for ensuring strong privacy protections and information security for customers’ banking data. A key element of these protections is that only trusted and accredited recipients will be permitted to access data, only with customers’ express consent and only for the purposes the customer has expressly permitted.

The Government has set a challenging but realistic timeframe for bringing the benefits of the Open Banking reforms to consumers, with a July 2019 commencement.

Open Banking will be phased in with the aim that all major banks will make data available on credit and debit card, deposit and transaction accounts by 1 July 2019 and mortgages by 1 February 2020. Data on all products recommended by the Review will be available by 1 July 2020. All remaining banks will be required to implement Open Banking with a 12-month delay on timelines compared to the major banks. The Australian Competition and Consumer Commission (ACCC) will be empowered to adjust timeframes if necessary.

The ACCC will be responsible for promoting competition and customer-focussed outcomes within the system, while the Office of the Australian Information Commissioner (OAIC) will ensure that privacy protection is a fundamental feature of the system.

Data61, the data arm of the CSIRO, will be appointed to perform the role of a Data Standards Body, developing technical standards for the system in collaboration with industry, FinTechs, and consumer and privacy groups.

Open Banking will be implemented as part of the Consumer Data Right in Australia, a more general right to data established by the Turnbull Government currently being created across the economy following a recommendation by the Productivity Commission’s Data Availability and Use Inquiry. The Consumer Data Right will be established sector-by-sector, beginning in the banking, energy and telecommunications sectors.

Further information about how Australians can benefit from Open Banking and the Consumer Data Right can also be found in the attached handout. For more information visit the Consumer Data Right page on the Treasury website.

Contacts: Andrew Carswell 0418 505 376, Kate Williams 0429 584 675, Sonia Gentile 0455 050 007 The Hon. Scott Morrison MP, Sydney

Consumer Data Right: Giving customers greater control over their data

The Consumer Data Right will give you greater control over your data.

The Consumer Data Right will allow you to ask for your data to be safely shared with trusted recipients. When you choose to share your data in this way, you will have control over who receives it and how they use it.

You will be able to use the Consumer Data Right initially for your banking, energy and telecommunication services, and eventually for other services across the economy.

The Consumer Data Right will enable more choice, tailored products and lower prices.

Comparison services will be better able to consider your specific circumstances to help you select deals that give you the best value for money.

Service providers will also be able to offer you a broader range of products and services that are tailored to your specific needs, such as services that assist your budgeting or help you decide whether to invest in solar panels.

The scope of services enabled by the Consumer Data Right is only limited by the imagination of entrepreneurs.

Strong privacy protections and information security will ensure your data is safe and secure.

Safeguards will be introduced to ensure strong privacy protections and information security when you are sharing your data. You will be able to feel confident that your information is secure and that you are in control of your data.

Save on your banking through a range of new services

You could save time by using new services to compare various credit card plans for you. These new services will be able to easily compare interest rates, annual fees, insurance policies and other elements of credit card products to help you find the best card for your lifestyle and budget.

New budgeting apps could help you better manage your finances to understand how you spend your money, and find ways you can save.

Only trusted and accredited recipients will be able to have access to your data. They will also only be allowed to use it for the purposes you have authorised.

Regulators will be well-resourced to enforce your privacy and consumer rights.

The Australian Competition and Consumer Commission will ensure appropriate consumer protections, and the Office of the Australian Information Commissioner will ensure appropriate privacy protections.

A newly formed Data Standards Body will set technical standards so that you can access your data in a safe and convenient way.

You will have simple and meaningful ways to resolve any concerns.

If you have any concerns, regulators and external dispute resolution services will be there to help you obtain any meaningful remedies you require.

The Office of the Australian Information Commissioner will be the single point of contact for all consumers to ensure that your concerns are handled by the right organisation.

Convenient data sharing will support our future economic growth and create high value jobs in Australia.

Consumer data will provide the fuel that will inspire domestic entrepreneurs and help grow our domestic data industry. New businesses will emerge and will create high value jobs for Australians. Encouraging high value employment increases economic growth and your standard of living.

You can use the Consumer Data Right from July 2019.

Banking will be the first industry in which you will be able to access your data. You will be able to direct the major banks to share your banking data on credit, debit, transaction and saving accounts with trusted recipients from July 2019.

The Consumer Data Right will then be applied to the energy and telecommunications sectors, giving you greater convenience in choosing your energy, internet and phone plans.

To help you understand your rights and responsibilities under the Consumer Data Right, a range of tools and guidance materials will become available prior to the new system commencing.

Save on your phone, internet and energy bills

With your permission, services could analyse your energy usage to help you decide what plan is best for you, and whether a particular energy source, such as solar power, is suited to your lifestyle.

Analysing your mobile phone usage could help you decide whether a cheaper service provider can provide you with a package that is more suited to your preferences.