Consumer Data Right gets the Government go-ahead
Consumers will have more control over how their personal information is used and the right to transfer it between service providers with a Consumer Data Right set to be enshrined in legislation.
The move means customers of banks, insurance companies and utilities providers could soon be able to request their provider to send their data to another provider.
That would allow easier switching between providers, but also spur new, innovation services allowing a range of providers to responsibly use data that is currently locked up.
Commerce and Consumer Affairs Minister David Clark said on Tuesday that the Government was in the process of building a regulatory regime that would support the roll-out of a Consumer Data Right framework.
It would be rolled out on a sector by sector basis, he added, "to ensure that the detailed requirements work in practice".
It would align with the Australian model introduced in 2019. That scheme started with the banking sector and is gradually extending to a broader range of financial institutions and energy utility companies.
But there have been frustrations relating to how difficult it can be to become, a so-called accredited data recipient (ADR) in the scheme.
Aussies to tweak their scheme
The Australian Treasury is considering new data sharing models that would encourage uptake of the CDR. It wants to make it easier for trusted companies to ingest data that consumers agreed to share with them.
There are only 13 ADRs currently - the pool will need to grow for the scheme to have any real impact. One of the proposals floated by Treasury involves ADR being able to sponsor other companies as ADR affiliates, streamlining the process of becoming accredited.
New Zealand officials would do well to watch Treasury's moves closely to avoid building overly onerous ADR conditions into its own framework.
"Any data shared through the consumer data right will only take place with a person's informed consent, and would be strictly used for the reasons agreed upon," said Clark.
"For example, if a person was seeking financial advice, they could ask their bank to share data, such as transaction information, with their chosen adviser."
The fintech industry is perhaps most enthusiastic about the introduction of a CDR as it will make it easier to access rich sets of data that can offer insights for customers.
Digital identity key
"It's also my intention that the consumer data right will work hand-in-hand with the Digital Identity Trust Framework announced earlier this year. It's that piece of work which sets out the rules for the delivery of digital identity services," Clark added.
The Government said it aims to make a second round of detailed policy decisions on the consumer data right framework later in 2021, and will look to introduce legislation in 2022.
You must be logged in in order to post comments. Log In