Posted: 08 Aug. 2019 10 min. read

A major step towards an open data economy

Consumer Data Right Bill passed: introducing open banking

UPDATED 17.09.2019

Please note that some dates have been amended, following updates to the Open Banking timeline. 


It’s a new era: At the beginning of August Australia took a major step towards an open data economy. The Consumer Data Right (CDR) legislation which gives consumers greater control over their data passed through both houses of Parliament and is now law.


Consumers will be able to decide what data to share, who to share it with, what it can be used for, and for how long.

The CDR is the Government’s response to the Productivity Commission’s 2017 review into Data Availability and Use and the subsequent Farrell Review into Open Banking.

It is intended to increase competition and provide consumers with more choice, better and more convenient products and services, and better prices.

Internationally Australia’s approach is seen as ‘inspiring’[1].

What’s next? Now the CDR legislation has passed, the rules and standards on privacy, information security and customer experience will be finalised. On 2 September, the ACCC released the ‘lock down’ version of the CDR Rules and Data61 is working towards the version 1.0 release of the API standards and Customer Experience guidelines. The ACCC has also released the ‘CDR Assurance strategy (banking)’ which outlines an extensive industry testing programme designed to ensure a successful go-live. As part of this assurance programme, an invitation has been issued for expressions of interest in becoming Accredited Data Recipients.

Open Banking: What it means for the consumer – and business

For consumers: The CDR legislation is all about empowering consumers. For example, if you want to leave your current bank, you can give them permission to provide your personal data to another accredited organisation. This will make it easier for you to compare financial products, and access better products and services and cheaper deals.

The ‘Big Four’ banks are the first banks to which the CDR will apply.

Three of the four started providing standard product information via APIs from 1 July 2019. From July 2020 they will be required, at the request of a customer, to share customer and transaction information with the customer or an accredited third party nominated by the customer.

Open Banking will be fully extended to all banks by February 2022.

For business: Under the new laws, data holders will need to ensure they have the technology (APIs) and processes in place to record a customer’s authorisation to share data, so they can then extract and share the data in accordance with the customer’s consent.

Banks will also want to think through how they respond to a customer’s request to share their data. This will require a strong understanding of customer profitability and pricing supported by strong credit analytics.

Organisations wanting to become data recipients will need to have robust information security and privacy processes in order to be accredited. They will need to have processes in place to ensure they are only using a customer’s data for the purpose and time for which a customer has consented to share it.

Banking Customer survey

To help consider the implications of the CDR on customers, Deloitte has surveyed banking customers[2] to understand:

  • Which organisations they trust
  • How willing they are to share data
  •  How customers search for information when they consider changing banks
  • What past switching patterns look like and what has caused them to switch
  • What do they value which would entice them to change banks in the future.

Open data: value unlocked

The CDR is not just about banking. It has the potential to change competition across the Australian economy. It will apply to the energy sector from 2020 and then the telecommunications sector. Other potential sectors to which it could be applied include insurance, superannuation, health insurance, loyalty schemes, social media and supermarkets.

The CDR is one component of Australia’s move towards an open data economy.  The government is also intending to introduce data sharing and release legislation in 2020 to promote open data in the Federal Government.  This will complement a range of existing data sharing legislation which apply to state governments.  And a growing number of organisations are increasing the availability of information they share with customers, suppliers and other stakeholders.

The biggest change in a generation

Open Data has the potential to transform the Australian economy. All organisations should be thinking about the possibilities of open data and how it could impact their sector.

Questions to consider include:

  • Are you willing to redefine how you deliver value to customers?
  • Can you change the way you collect and use customer and transaction data?
  • Will your privacy and cyber security capabilities be robust enough to enable you to meet your compliance obligations?
  • Will your technology and data analytics capabilities enable you to take advantage of the opportunities that open data presents? 
  •  Are you willing to champion an open data ecosystem and embrace alliance partners in delivering value to customers?

It’s time for organisations to think about how they respond to the emerging open data economy.

And it starts now.


[1] CSIRO Data 61 CEO Adrian Turner - AFR Innovation Summit 30 July 2019

[2] These results will be published soon – keep an eye out!