Senate FinTech and RegTech review and Consumer Data Right

The Senate Select Committee on Financial Technology and Regulatory Technology has published an Issues Paper related to its terms of reference.

The Committee will inquire and report on :

  • the size and scope of the opportunity for Australian consumers and business arising from financial technology (FinTech) and regulatory technology (RegTech);
  • barriers to the uptake of new technologies in the financial sector;
  • the progress of FinTech facilitation reform and the benchmarking of comparable global regimes;
  • current RegTech practices and the opportunities for the RegTech industry to strengthen compliance but also reduce costs;
  • the effectiveness of current initiatives in promoting a positive environment for FinTech and RegTech start-ups; and
  • any related matters.

The Issues identified included a number related to the Consumer Data Right.

CDR cost issues
Australian FinTech organisations have stated that the cost to become accredited under the CDR legislation would be a large impediment to uptake for start-ups, with FinTech Australia providing feedback that the average cost is estimated to be from $50,000 – $100,000 in annual compliance fees.

‘Write-access’ for CDR data in Open Banking
The CDR legislation in Australia only permits “read-access” for banking data. Enabling write-access in Open Banking would allow accredited data recipients to make changes to a customer’s financial data held by other institutions and to use this access for activities such as account switching or even payment initiation.

CDR in superannuation
The Productivity Commission recommended in January 2019 that the Australian Government should extend the CDR to superannuation. Accessing superannuation and insurance product data from these service providers could help customers with a greater understanding of their own products, how much they cost them and whether there are better or more appropriate products for them.

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