Only two ADIs accredited as CDR data recipients

Originally published at Banking Day

By John Kavanagh

The number of banks and other authorised deposit-taking institutions accredited as providers for open banking is growing but only two of those ADIs are also accredited as data recipients - the entities that will provide services using shared data.

So far only Commonwealth Bank and Regional Australia Bank are both accredited providers and data recipients.

The chief information officer at financial software company Biza.io, Mark Perry, said he expected a lot of data holders would become ADRs eventually. It is only a matter of time.

Perry said: “It makes sense. As ADRs, they can see what business their customers have with other financial institutions and they can see what products they should be offering them.”

Biza.io provides cloud-based CDR services to data providers and ADRs. Its CDR clients include Regional Australia Bank, Tyro and Australian Military Bank.

Perry said the slow take-up of data recipient accreditation and the large number of data providers that have sought exemptions is due to ADIs underestimating the effort required.

“In some cases they are working with core banking vendors that have also underestimated the task. It has not helped that the Australian government specifications are highly customised, which means banks and their software providers can’t use off the shelf solutions.”

Biza.io was started in 2017 by Stuart Low, a former head of innovation at Rabobank and lead engineer of CSIRO’s data standards body.

Perry said the CDR use cases Biza.io is discussing with clients include personal financial management services and payments. [Mark’s note: Biza is not speaking to clients about personal financial management services]

“We are just starting to work with clients on how payments could be initiated through open banking.”

Perry said Biza.io supported the latest proposed changes to the CDR rules, which would introduce tiered accreditation, a CDR representative model and access by trusted professional advisers.

He said the government’s aim was to bring more participants into the system and, if successful, Australia would lead the way in the development of CDR.