Open Banking in Australia sees rapid growth in consumer adoption

The latest Australian Open Banking Ecosystem Map and Report has been released by FinTech Australia, marking the fourth edition of the report. This edition reveals a growth in Open Banking use cases within the country, particularly in lending, credit, and broking, alongside personal finance and payments sectors. The report was prepared with support from Mastercard and in collaboration with FinTech NZ, Payments NZ, and Open Finance ANZ.

Open Banking in Australia has now entered the consumer adoption phase for the Consumer Data Right (CDR), a framework that grants individuals and organisations increased control over their data, enabling secure data sharing with third parties. The data for this report, sourced from the Australian Competition and Consumer Commission's (ACCC) Provider Register, indicates an expanding migration to Open Banking across the ecosystem. Currently, there are 135 CDR Representatives, a 165% increase since December 2022, and 96 active Data Holders. Remarkably, almost all consumer bank accounts (99.74%) are now linked to the ecosystem, positioning Australia favourably for further Open Banking adoption.

Of the ecosystem, 64% is made up of Data Recipients, entities authorised to receive consumer data pending consent. These recipients drive the creation of data use-cases and encourage consumer uptake. A notable 89% of these Data Recipients employ third-party intermediaries, such as Outsourced Service Providers (OSPs), to access data through the CDR Register, showcasing the pivotal role these providers play in bolstering CDR participation.

The report highlights a rise in Open Banking use cases across various sectors, including climate and sustainability, health, philanthropy, and hospitality. This diversity underscores the significant progress and maturity of the Australian Open Banking ecosystem.

Rehan D'Almeida, CEO at FinTech Australia, remarked, "With use cases starting to emerge, the challenge now is to encourage the capture and sharing of data on uptake and usage in order to quantify the impact of the CDR."

"Current cost of living challenges and higher interest rates make it more important than ever for us to see CDR enabled products in the hands of consumers at scale; helping them manage their finances, getting a better deal and saving them money. We expect the next 12 months will be a period of innovation and uptake as the ecosystem matures, with FinTechs continuing to lead the way," D'Almeida added.

Brenton Charnley, Vice President and Head of Open Banking, Australasia at Mastercard, also provided insights, stating, "Mastercard has been powering and protecting its global payments network for more than five decades, and Mastercard's Open Banking technology allows consumers to use their financial data for their own benefit to access innovative, new and improved experiences. Mastercard recognises the potential of the Consumer Data Right (CDR) in Australia to significantly empower consumers with more choice and control over their financial data."

"Mastercard looks forward to the government's response to the current consultations that focus on screen scraping and improvements to consent and data quality. These reforms will support both consumer and business adoption," Charnley added.

FinTech Australia is set to partner with FinTech NZ and Payments NZ to extend the scope of the report to the Aotearoa New Zealand market, providing a regional perspective on the adoption of the CDR. Future editions of the Open Banking Ecosystem Map are expected to reflect this expanded regional focus.