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Data rights expand,
Non-bank lending in the plan,
Consumer command.
Government calls for feedback on draft rules for expanding Australia's Consumer Data Right to non-bank lending
The Federal Government has now released draft rules for its plans to expand the Consumer Data Right (CDR) to non-bank lending and is calling on final feedback by 24 December on the proposed changes.
The aim is to extend CDR to non-bank lending, removing the requirement for banking and non-bank lending data holders to share CDR data for niche products and data that does not add significant value to consumers. The CDR was first implemented in banking in 2019 and since 2022, all banks have been required to share product and consumer data. The Government released draft amendments to CDR rules last year to begin the process of extending out its scope.
The proposed changes aim to narrow the scope of obligations to reduce costs for non-bank lenders and banks, and ensure the CDR targets priority use cases, such as consumer finance and lending, without imposing costs and burden on smaller lenders. Updated draft rules include a customer threshold of 1000 customers instead of 500 or more under the previous proposal, clarification that CDR data sharing obligations also apply to managers of loans that provide credit on behalf of a non-bank lender, and options for non-bank lending data holders to join the CDR voluntarily.
The Government said expansion of CDR to non-bank lending will allow consumers to share their bank data with non-bank lenders for products like residential mortgages and car loans to get better outcomes when it comes to approvals and interest rates.
"The Government has listened to feedback on the expansion of the CDR to non-bank lending and said these changes will give consumers more ways to take control of their household finances, and greater confidence that their data is being protected," said assistant treasurer and Minister for Financial Services, Stephen Jones. "The changes put consumers at the heart of the Government’s reset of the CDR.
"The Government encourages all interested parties to make a submission on the draft rules, which can be found on the Treasury website."
Submissions will close on 24 December 2024.
