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Speaker 1: Welcome to ask Fear and Greed when we answer questions

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Speaker 1: about business, investing, economics, politics and more. I'm Thompson, Hello,

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Speaker 1: Sean al, Hello Michael, Sean. I'm curious about today's question.

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Speaker 1: I mean, I'm curious about all of them, but this one.

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Speaker 1: When we first started Fear and Greed, remember five years ago,

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Speaker 1: and it was during the pandemic, and we talked a

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Speaker 1: lot about open banking. Yes, we did a whole lot

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Speaker 1: of interviews about it. It was all very exciting and

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Speaker 1: everybody was talking about it. Right, we used to hear

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Speaker 1: so much about open banking. Why has it dropped off

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Speaker 1: the radar? And actually, maybe, first of all, what is

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Speaker 1: open banking? But why don't we talk about it anymore?

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Speaker 2: Okay? So open banking allows you to share your banking information,

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Speaker 2: your data with third parties. So let's say my bank's

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Speaker 2: Commonwealth Bank or Westpac or Nabay and zed. I'm just

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Speaker 2: going to call it ABC Bank because I don't want

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Speaker 2: to favor anyone. My relationship is a one on one

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Speaker 2: with ABC Bank. Right. What open banking allowed was for

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Speaker 2: my data to be shared with the other banks, so

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Speaker 2: that if I wanted to change mortgage providers, or if

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Speaker 2: I wanted a credit card from someone else, I didn't

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Speaker 2: have to get all that information myself and send it

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Speaker 2: to the new bank. They could just share the information. Okay,

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Speaker 2: So that was the idea. It was supposed to make

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Speaker 2: changing banks a lot easier. Basically, you're giving authorized organizations

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Speaker 2: access to your financial information, so it makes it easier

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Speaker 2: to compare products, manage money, switched new banks, all that,

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Speaker 2: the h will see, the Competition and Consumer Commission all

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Speaker 2: over it all.

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Speaker 1: I loved it, yeah, okay.

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Speaker 2: Now, it started on one July twenty twenty and we

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Speaker 2: did talk a lot about it. The thing is, there

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Speaker 2: were a couple of phases, and I think it was

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Speaker 2: called read only was the first part, and that went ahead,

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Speaker 2: but it seems to have sort of run out of

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Speaker 2: steam now. I can't you exactly where it's up to today,

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Speaker 2: but certainly the Australian Bankers' Association has been really critical

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Speaker 2: of it in the last twelve months, saying we did

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Speaker 2: all this work, we spent billions of dollars in the

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Speaker 2: industry itself would have spent billions of dollars because they

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Speaker 2: had to to make sure open banking could run across

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Speaker 2: the major banks. And people just haven't taken it up. Now.

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Speaker 2: I think part of this might be because the banks

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Speaker 2: aren't encouraging it. I don't know quite why that's the case,

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Speaker 2: but you would think that is a bit of a

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Speaker 2: no brainer. But what the banks are saying is that

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Speaker 2: customers just aren't really taking up the option.

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Speaker 1: That really strikes me as odd as very odd, right,

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Speaker 1: because you would think in this day and age, we

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Speaker 1: almost would expect that as the bare minimum, that we

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Speaker 1: would be able to basically own all of our data

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Speaker 1: and it just be shared when and where it needs

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Speaker 1: to be, without lengthy delays and without to do it

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Speaker 1: all yourself. You would just expect that to be part

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Speaker 1: of the process and not something that you would need

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Speaker 1: to actively kind of take up.

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Speaker 2: Yes, now I'm sort of speaking on dangerous territory here,

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Speaker 2: because there'll be some expert who will say, no, no, no,

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Speaker 2: you're wrong. But I think some of the initial processes

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Speaker 2: and the initial benefits from it were taken up, but

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Speaker 2: there was subsequently a bunch of other options that were

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Speaker 2: supposed to play out, and they just don't seem to

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Speaker 2: have played out. And in fact, I look at a

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Speaker 2: timeline on open banking and nothing much has happened since

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Speaker 2: twenty twenty two, and so it just seems to have

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Speaker 2: stalled now at some point. Sharing of data, I mean,

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Speaker 2: we all share a data much more now anyway. And

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Speaker 2: if you go to your bank and say, hey, I

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Speaker 2: want to go from ABC to DEEF bank share my data,

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Speaker 2: They're going to do it. So it is actually practical,

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Speaker 2: but it hasn't been the game changer. I think the

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Speaker 2: bottom line here, there hasn't been the game changer, okay

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Speaker 2: that the industry and the Austra Competition Consumer Commission and

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Speaker 2: consumer groups had hoped it would be.

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Speaker 1: Okay, because really we were very excited about it back

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Speaker 1: in twenty twenty. I remember losing sleep at one point. Yes,

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Speaker 1: I might be overstating it a little bit, but there

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Speaker 1: wasn't generally a great deal of anticipation about what it

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Speaker 1: was going to mean and how easy it was going

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Speaker 1: to make it for consumers. But also you did have

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Speaker 1: this sense that there was so much work going into

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Speaker 1: it and being had a lot of money being spent.

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Speaker 2: Yeah, so the ABA has estimated about one point five

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Speaker 2: billion dollars with a tiny, tiny take up rate.

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Speaker 1: Oh wow, okay, all right, that is good, Thank you Sean.

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Speaker 2: Thank you, Michael.

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Speaker 1: Remember if you've got something you'd like to know, then

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Speaker 1: please send three a question on LinkedIn, Instagram, Facebook, basically

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Speaker 1: any of the social media platforms or Fear Andgreen dot

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Speaker 1: com Today you and send your question on through will

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Speaker 1: get to it as soon as possible. Are Michael Thompson

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Speaker 1: And this is asked Fear and Great