Australians uncomfortable with sharing finance data

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More than half of Australians aren’t comfortable sharing personal data with third parties to gain a hand at better deals, according to research from fintech Zepto.

Another 43% rejected the concept of sharing data with service providers, while only a small percentage was willing to share certain kinds of data – only 18% was willing to share purchase history, share transactions (12%) and share bank balances (10%), the research revealed, as reported by australianfintech.com.au.

Read next: ACCC takes “major step” towards open banking

Zepto is a digital merchant payment solution provider, based in Byron Bay. Its research follows the planned expansion of the Consumer Data Right (CDR), also known as open banking, to cover open finance including insurance, superannuation, merchant acquiring and non-bank lending.

While open banking has a legal, regulatory framework, open finance is still in its early stages of consultation, which the federal government only kicked off last March.

It’s been two years since open banking officially launched nationwide and the natural next step for the industry is to integrate open finance into the industry. This involves a much broader range of financial products extending beyond the banking sector – which is also where most consumer hesitation comes from. 

Zepto’s study reflected similar data from the Consumer Policy Research Centre, which shows that an overwhelming 94% of Australians are uncomfortable with how their personal information is collected and shared online.

Qualitative interviews revealed that a number of them don’t understand why businesses would need access to their personal data at all and believe that businesses gain more from the exchange than they will.

They’ve also expressed concerns over the possibility of service providers adjusting certain offers to customers based on financial health.

Read more: Cry for more targeted open banking education

James Harvey (pictured), head of customer experience at Zepto, told australianfintech.com.au that consumers are more willing to consider open data if they had more control over the process – something that already comes with open finance but consumers are yet to be aware of.

“It is very early days for open finance but alleviating data privacy concerns while convincing consumers of the benefits and fairness of the regime will probably require a long education phase,” Harvey said.

 

“I believe we should start that education sooner rather than later if we want open finance to be embraced by consumers.

 

“As to who will take responsibility for this education, this is something that we may want to tackle throughout the consultations.

 

“I believe open banking’s slow uptake is due to a deficit of trust,” Harvey said.

 

“Consumers have been burned and badgered by businesses and unscrupulous operators with access to their data. Rebuilding trust around the idea of data sharing will take time and a lot of work.”

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