Treasury is developing new rules for Australia’s Consumer Data Right which would significantly expand businesses’ access to consumer data, following criticism that the accreditation requirements to participate are too high.
Under the proposed changes, an accredited data recipient (ADR) will be allowed to give third parties access to the data portability scheme on their behalf but would retain liability for their actions. ADRs would also be able to sponsor other parties such as fintechs to become accredited.
Treasury has also proposed allowing consumers to give “trusted advisers” like lawyers and mortgage brokers access to their CDR data even when they are not formally accredited.
Consumers would also be able to share certain “insights” from CDR data to help verify thing like their identity and income level for services like loan applications.
The CDR, which is first being applied through open banking, allows users to request access to their data in a machine-readable way. More portable data is expected to drive innovation and increase competition by lowering the barriers for consumers to switch providers like banks, energy companies and telcos.
Currently, participants in the CDR system require explicit clearance from regulators who need to be satisfied they have the technical capability and privacy and security protections to safely share consumers’ data.
But some of the accreditation requirements have been criticised by participants as being too onerous, particularly for smaller players like fintechs, and accreditation levels have remained low beyond the big four banks which are mandated to share CDR data.
The government stripped control of Australia’s data portability scheme from the consumer regulator and gave it to Treasury last year after being frustrated by the slow uptake of a policy it had described as a game changer.
In an update on Friday, Treasury said it will work with the Data Standards Body – which also moved to Treasury from the CSIRO in the shakeup last year – to consult on the supporting data standards to prior to the release of the new draft rules.
“The intent of the rules is to provide a safe, convenient and efficient way for consumers to consent to an accredited person sharing their data with trusted advisers, support consumer convenience and reduce the costs of accreditation for smaller participants and start‑ups, without reducing the overall security and privacy protections of the regime,” the update said.
Treasury also opened consultation on the government’s proposal for a peer-to-peer model for the CDR in the energy sector and an opt‑out data sharing model for joint accounts in both banking and energy schemes.
An inquiry into the future directions of Australia’s CDR by KWM partner Scott Farrell last year made 100 recommendations for reform to improve the functionality of the scheme, including allowing more access for third parties.
The government is yet to respond to the inquiry.