Home' Superfunds : Superfunds November 2018 Contents Q: Why do you think there is a need for
financial data aggregators today?
A: Consumers are seeking better understanding
and control over their finances, which ultimately
helps them to make better decisions and be better
off. Data aggregators facilitate this by giving
people a complete view of their finances.
Having access to their entire financial history
means consumers can use that history to their
advantage. For example, consumers may use
their financial history to apply for new products
and services or seek better terms. Financial
aggregators are able to combine information from
various financial institutions whose systems do
not talk to each other and provide an automatic,
complete financial history for consumers.
Q: Can you explain open banking and
describe what an open banking world would
look like in Australia?
A: Open banking refers to the use of technology
to enable financial institutions such as banks
and other parties, such as fintechs, to share data
between themselves at consumers’ direction.
The Federal Government is proposing to
establish a Consumer Data Right (CDR). The CDR
will be the foundation of open banking by making
it law that the data an institution holds on an
individual belongs to that individual.
According to the current schedule, the first
CDR standards will be agreed by the Data
Standards Body later this year and the open
banking framework should be set to start in mid-
In Australia, this will create an environment
where consumers have control of their financial
data, and both consumers and financial
institutions are capable of exchanging information
easily and securely. This will also create
opportunities for financial institutions to facilitate
innovations in customer experience, particularly
when onboarding for financial products and
By introducing a framework that supports
economy-wide open data and data sharing,
opportunities are presented for fintechs to partner
with, and support, financial institutions to thrive
in the new world of open banking.
The first industry in which the CDR will be
implemented is banking, but other industries
will follow in the future. In fact, companies from
other sectors like superannuation and wealth
management are already moving in this direction.
It won’t be long until we start talking about open
super, open wealth or open insurance, and this
could happen long before the CDR becomes
mandatory in these industries.
Q: How can super funds work with financial
data aggregators to benefit members?
A: We believe member engagement can be
improved by addressing a core problem – the
‘fragmentation’ of Australians’ financial lives
and the lack of visibility they have over their
entire finances in real time. In this way, financial
data aggregators have developed an approach
in which people can have full oversight of their
entire financial situation.
Super funds can work with aggregators on
many different levels in a way that provides
helpful benefits to members. For example, this
type of partnership can facilitate a smoother
onboarding process for members when joining
a new super fund. Another example is fund
consolidation; as many consumers simply accept
their new employer’s default super fund because
they don’t know the details of their previous
one, financial data aggregators can help increase
member retention for existing super funds.
A third example of how super funds and
aggregators can work together to benefit
members could be implementing a salary sacrifice
calculator to help members understand how
their actions affect their retirement. This, in
turn, benefits super funds by increasing digital
engagement with members and potentially
increasing the amount of salary sacrifice.
Q: What do you see as the main
opportunities and challenges for the financial
services industry and its customers in the
next few years?
A: The introduction of open banking means
some immediate challenges in terms of becoming
compliant with the new regulations. The
framework will create some regulatory costs for
Superfunds November 2018
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