On Wednesday, the ACCC confirmed that Bank of Queensland (BOQ) has paid a penalty of $133,200 for allegedly breaching the Consumer Data Right (CDR) Rules.
In its first infringement notice issued for an alleged breach of the rules, the ACCC claimed that BOQ had failed to provide a service enabling consumers’ data to be shared.
The bank was meant to be in a position to share data for financial products, including savings accounts, term deposits and credit cards, by 1 July 2021. However, the competition regulator said that BOQ did not make the required services available until 13 December 2021.
“Under the CDR, consumers have a right to safely and securely share certain data with accredited providers, including fintech firms and other third parties, who in turn can use that data to create better-customised products and services for the consumer,” explained ACCC commissioner Peter Crone.
“For the CDR to work effectively for consumers, participants including all banks must meet their data sharing obligations within the timeframes set by the regulations.”
The ACCC noted that a number of banks had suffered delays with implementing their CDR solutions, partly attributable to the pandemic and a shortage of skilled IT resources.
It said that, before issuing BOQ with an infringement notice, it had taken into account a number of factors including the period of the bank’s alleged non-compliance, the number of customers potentially impacted, the resourcing constraints faced in developing CDR infrastructure and the steps taken to limit the duration of non-compliance.
“In the current environment of rising interest rates, consumers benefit from greater access to information and tools to help them compare products and make informed decisions about switching banks, and the CDR assists this,” said Mr Crone.
“As it is rolled out, the CDR will increase consumer choice and promote the innovation needed to improve competition in financial services and other areas. It will play a central role in enhancing productivity.”
The CDR was initially rolled out to major banks in July 2020 before expanding to other banks in July 2021. It has since expanded beyond ‘open banking’ to also cover energy and telecommunications along with a proposed expansion to non-bank lending, merchant acquiring, general insurance and superannuation.
The ACCC stated that it closely monitors compliance with CDR obligations and provides support for participants to assist them in preparing for and entering the CDR program.
Those that do not comply with their obligations may face enforcement action from the ACCC including administrative outcomes, enforceable undertakings, infringement notices, suspension or revocation of accreditation and court proceedings.
Jon Bragg is a journalist for Momentum Media's Investor Daily, nestegg and ifa. He enjoys writing about a wide variety of financial topics and issues and exploring the many implications they have on all aspects of life.