Opening doors to the future

DXC believes the CDR has the potential to drive nothing less than a revolution in the Australian banking landscape; a change for the better, to make Australian banks more competitive on a global scale. Leveraged smartly and creatively, the CDR can help banks provide smarter and more relevant services to their customers and create banking products that weren’t previously possible. Above all, it’s a significant opportunity to reposition ‘The Bank’ as a fundamental pillar of every Australian’s life.

Today’s environment is one of excitement and opportunity, tempered by risk-awareness and a keen desire to keep an eye on what others are doing. For banks that see CDR more as an opportunity than a threat: how can you grasp that opportunity – and how can you grasp it quickly and confidently, and use it to differentiate competitively?

All about the CDR

The CDR is a data-sharing reform introduced by the Australian Government with the intention of an economy-wide roll out. Starting with banking, the CDR will be gradually introduced to various sectors, including energy and telecommunications.

The objectives of the CDR are to:

  • Provide consumers with the ability to efficiently and conveniently access their personal data held by businesses, aka data holders, and, authorise the secure sharing of data to trusted and accredited third parties, aka the accredited data recipients (ADRs).

The CDR requires businesses to provide public access to information on transactional data and products they offer, giving consumers the ability to access and use this information and improve their understanding around providers and products and switch providers if they find a better deal. In January 2020, the Australian Treasurer announced an inquiry into Future Directions of the Consumer Data Right1 , looking at how the Consumer Data Right could be enhanced and leveraged to boost innovation and competition, and support the development of a safe and efficient digital economy, including examining how the Consumer Data Right could be expanded to include ‘write’ access transactions.

For more details about the CDR, you can visit the ACCC’s website by clicking here.

Open Banking

It’s important to understand Open Banking not in isolation but as part of the wider CDR agenda, which is key to unlocking innovation, competition and a revolutionising of the Australian consumer digital landscape.

Open Banking isn’t a particularly new concept – it has been in the European lexicon as early as 2010 and widely used since late 2015, when the European Parliament adopted a revised Payment Services Directive, commonly referred to as the PSD2.

The parallels with Europe can be instructive for Australian banks. European banks were at first hesitant to dive headfirst into the PSD2. However, over the past five years, banks across Europe have made significant headway in incorporating Open Banking and reaping the rewards it can offer.

In the United Kingdom, for example, Lloyds Commercial Banking has seen the value collaborating with FinTechs can bring2 and have adapted their approach to improving how they collaborate with potential partners. A recent example of this includes successful collaboration with Xelix3 - a platform that uses machine learning to enhance validation and decision-making process within a business’ accounts payable.

Download the full paper to find out more

About the author

Ingrid Schnell is Industry Chief Technologist