{"id":2570,"date":"2021-08-04T01:10:06","date_gmt":"2021-08-04T01:10:06","guid":{"rendered":"https:\/\/basiq.io\/blog\/basiq-response-to-cdr-amendment\/"},"modified":"2023-12-06T11:26:31","modified_gmt":"2023-12-06T00:26:31","slug":"basiq-response-to-cdr-amendment","status":"publish","type":"post","link":"https:\/\/www.basiq.io\/blog\/basiq-response-to-cdr-amendment\/","title":{"rendered":"Response to CDR Rules on accreditation and sponsorship models"},"content":{"rendered":"\n

Fintechs offer valuable lessons for the CDR and Open Banking<\/h2>\n\n\n\n

At Basiq, our mission is to provide fintechs with the building blocks of financial services, whether it\u2019s access to financial data or tooling. At the heart of the CDR (Consumer Data Right) and Open Banking is the consumer-consented sharing of data to accelerate innovation, drive competition, promote transparency and increase consumer benefit. Since 2017, we have been carrying out this mission by enabling fintechs to leverage open financial data, with clients ranging from some of Australia\u2019s largest fintechs, to startups in pre-launch stage.<\/p>\n\n\n\n

Our experience and our customers have taught us valuable lessons we can use to provide consultation and feedback on the CDR, from a practical, use cases focused perspective. As such, we have taken the opportunity to provide feedback to Treasury on version 3 of the proposed changes to CDR rules, with the purpose of championing the voice of our customers and fintechs of all sizes.<\/p>\n\n\n\n

<\/div>\n\n\n\n

Summary of the CDR rules amendments (version 3)<\/h2>\n\n\n\n

As it stands, the CDR is still in its infancy, with complex rules and a resource-intensive path to participation. Version 3 of the proposed changes to the Consumer Data Right and, in particular tiered accreditation and sponsorship models have been hailed as a step forward in building a more inclusive Open Banking ecosystem.<\/p>\n\n\n\n

Overall, we welcome the move to enable access to CDR data without the prerequisite of becoming a fully accredited data recipient (ADR), however, the levels of responsibility, liability and data accessibility varied greatly amongst the proposed models and added undue complexity.<\/p>\n\n\n\n

The \u2018Principal CDR representative model\u2019 would absolve any third party of responsibility over the data they hold and place full liability on the ADR. On the other hand, the \u2018Sponsorship model\u2019 is unclear about what \u2018shared liability\u2019 entails and is very similar to full ADR accreditation. In contrast, the \u2018Trusted Advisor model\u2019 doesn\u2019t take into account the need to provide persons with a base level of education around the security and governance of CDR data.<\/p>\n\n\n\n

<\/div>\n\n\n\n

Building a more inclusive ecosystem with a ‘Consumer Service Provider’ model<\/h2>\n\n\n\n

To better balance the governance structure needed to support the ecosystem whilst reducing barriers to participation, we propose a simplified single ‘Consumer Service Provider’ model that works based on four principles.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Different parties and requirements using a simplified ‘Consumer Service Provider’ model.<\/p>\n\n\n\n

    \n
  1. CDR data should be shareable with non ADRs. Many businesses already handle sensitive customer data i.e. banking, passports and medical data. If these businesses are able to seek consumer consent and handle the data in a safe and CDR-compliant manner, then non-accreditation should not prohibit them from doing so.<\/li>\n\n\n\n
  2. ADRs that require direct access and communication with Data Holders should continue to be regulated as per current requirements.<\/li>\n\n\n\n
  3. ADRs should be responsible for educating third parties on data security and governance.<\/li>\n\n\n\n
  4. Each party should ultimately be responsible for their own actions in the handling of CDR data.<\/li>\n<\/ol>\n\n\n\n

    The above principles are focused on facilitating greater participation and innovation to accelerate the delivery of more personalised, data-driven offerings benefiting consumers. For consumers, the process of consenting and sharing data is simply a stepping stone to accessing a broader range of financial products. Similarly, for fintechs, the benefit of the CDR lies in what they can build with Open Banking data, rather than how to access it.<\/p>\n\n\n\n

    <\/div>\n\n\n\n

    You can read our full submission here<\/a>. If you’d like to read the CDR draft rules, head to the Treasury website<\/a>.<\/p>\n\n\n\r\n

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    \r\n\t\t\t\tArticle Sources\t\t\t<\/h5>\r\n\t\t<\/div>\r\n\r\n\t\t
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    The CDR is in its early stages, marked by intricate rules and a resource-intensive entry process. 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    Basiq mandates its writers to leverage primary sources such as internal data, industry research, white papers, and government data for their content. They also consult with industry professionals for added insights. Rigorous research, review, and fact-checking processes are employed to uphold accuracy and ethical standards, while valuing reader engagement and adopting inclusive language. Continuous updates are made to reflect current financial technology trends. You can delve into the principles we adhere to for ensuring reliable, actionable content in our editorial policy<\/a>.<\/p>\n\t\t<\/div>\r\n\t<\/div>\r\n<\/div>\r\n","protected":false},"excerpt":{"rendered":"