Consumer Data Right ready to be tested ahead of February go-live

The consumer watchdog has named the 10 financial services firms and startups that will be testing components of the first tranche of the Consumer Data Right.

Rules drafted on how to access data under Consumer Data Right The draft rules stipulate that data-holders must stand up a specialised service to take applications and administer data if approved.

The Australian Competition and Consumer Commission (ACCC) has revealed 10 financial services and data-focused firms that will participate in Consumer Data Right (CDR) testing ahead of the first tranche, open banking, which will be introduced in February 2020.

The ACCC has named neobank 86400; finance and budget management app-maker Frollo Australia; blockchain-focused Identitii; accounting software company Intuit; financial data aggregation platform Moneytree; Procure Build, which specialises in construction industry risk management; Sydney-based fintech Quicka; the Regional Australia Bank; income verification company Verifier Australia; and Wildcard Money, which touts itself as the "ethical alternative" to the Big Four.

40 expressions of interest were received in response to the invitation to participate in CDR testing.

The ACCC said the 10 entities were selected as they offer a broad range of innovative services. In choosing the 10 entities, the watchdog said it looked specifically at its intention and ability to meet the accreditation criteria by February 2020, its readiness to participate in testing, and the proposed use cases for the CDR under the context of the rules proposed by the ACCC.

"Our intention is that participants in testing will be ready to participate in the CDR ecosystem from February 2020 following successful progression through testing, demonstrating their ongoing capacity to meet eligibility criteria, and complying with the rules," the ACCC said.

"Participation in the CDR ecosystem from February 2020 as an accredited person of course requires the person to achieve accreditation under the rules."

The ACCC has also released its CDR accreditation guidelines that it said are designed to provide information and guidance for applicants who are applying to become an accredited data recipient.

The accreditation guidelines will be updated as the CDR ecosystem evolves, the ACCC said, which will see the inclusion of additional sectors under the CDR mandate.

The CDR, through the Treasury Laws Amendment (Consumer Data Right) Bill, allows individuals to "own" their data by granting them open access to their banking, energy, phone, and internet transactions, in addition to gaining the right to control who can have it and who can use it.

The first sector to which the CDR applies will be finance, through an open banking regime.

Under this mandate, ANZ, the Commonwealth Bank, NAB, and Westpac will be required to give consumers greater access to the information the banks' hold on consumers. It will also give consumers the power to require those banks to provide safe and secure access to that information to trusted third parties. Remaining financial services companies are expected follow suit in falling under the CDR mandate.

The Big Four have already made access to generic product data for credit and debit cards, deposit accounts, and transaction accounts via an application programming interface available under the mandate.

The Bill finally passed through Parliament in August, with the previously scheduled July 1 go-live having been pushed back when the Bill was stranded before a federal election. The Bill was then passed with no amendments, although the federal opposition was promised the right to delete would be added to the mandate.

The Bill was passed despite concerns that the CDR would be too finance-focused to be applicable to other industries.

Despite hearing concerns over the adequacy of the privacy safeguards, the rushed nature of the Bill, the distinct banking focus it will have, and whether the outcome of the CDR will serve organisations more than it will consumers, the Senate Economics Legislation Committee on March 21 recommended that it be passed.

"At the very least, it will improve on current arrangements; and it has the potential to protect and empower consumers and drive competition and innovation," the committee wrote at the time. "The committee particularly welcomes the endorsement of the Bill from innovative high technology companies."

In justifying its reasoning behind allowing the sole recommendation that the Bill be passed, the committee said provisions such as the rules-making facility under the Bill would offer the possibility for problems to be addressed as they arise.

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