Westpac and CommBank hit back at Aus Open Banking plans

Westpac and CommBank hit back at Aus Open Banking plans

Australia's big banks have begun a rearguard action to stave of the introduction of a new Open Banking regime, calling for an extended deadline as high costs and security issues take their toll.

Australia moved one step closer to implementing Open Banking with the publication of a final Government report into the issue in February. Commissioned in July last year, the report makes 50 recommendations, on the regulatory framework, the type of banking data in scope, privacy and security safeguards for banking customers, the data transfer mechanism and implementation issues.

In a submission to the Treasury, Westpac says the introduction of the new reforms will cost the bank $200 million to implement and $250 million in additional fraud costs to cover an expected rise in phishing attacks as the new framework is introduced.

Arguing that the data-sharing regime will result in an "inherent systemic risk across the banking system and industry", Westpac wants to be able to recover costs from third parties that use the data and to limit the scope of re-use.

It has also described the Treasury's proposals to start the clock ticking on a 12-month timeframe within the next few weeks as "unfeasible", given that rules and standards covering safety and liability issues have yet to be agreed.

Westpac rival Commonwealth bank is also understood to be singing from the same hymn sheet, calling for initial limits on the type of data to be shared and a phased introduction across products beginning twelve months after standards have been agreed.

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