The Open Banking Era: Surfing the Australian Data Wave

Open banking regulatory regimes represent an attempt by regulators to take advantage of a wave of digitalization and its associated sea of data to encourage more dynamic and efficient financial services sectors. This chapter explores Australia’s Consumer Data Right regime and how its planned expansion beyond financial services could propel fundamental changes to large sectors of Australia’s economy and society. We explore why these regimes are being put into place now and what these changes could look like, including potential consequences. Lastly, we provide recommendations on how regulators should build data sharing regulatory regimes. In order to best achieve the goals of encouraging data leveraged social economic development, financial inclusion, and furthering innovation through data sharing requirements, we make three recommendations. First, regulators must ensure the burdens and benefits of these regimes are consistent and fair, as it is very easy to replace one asymmetry with another. Second, consumers must be at the center: their benefits and safety are paramount to adoption and success of an economy that properly leverages consumer data. Third, open banking regimes must consider other technological developments, regulations, and trends to be incorporated as part of a larger national data strategy if they are to be effectively adopted.