The Australian fintech ecosystem has made great strides over the past few years, with record levels of investor capital, new job creation and international expansion. For Australia, the number of fintech companies opening has grown rapidly from approximately 400 entities in 2017 to more than 800 in 2021 and this number continues to grow.
A major contributing factor to the surge in fintech startups has been the introduction of the Consumer Data Right (CDR). Introduced in July 2020, CDR is giving consumers greater control over their financial data and is helping fintech’s access consumer data to create richer, more efficient and personalised solutions to meet the financial needs of Australians. While historically this has been a costly process for fintechs, the evolution of CDR has provided more accessibility and bolstered growth in this space. As the financial ecosystem continues to expand, access to the CDR has a key role to play.
Envestnet | Yodlee has been an active Accredited Data Recipient (ADR) and Intermediary under CDR since its introduction. When combined with Envestnet | Yodlee’s ability to access non-CDR data, such as investment portfolios and superannuation, it creates a hybrid data solution for Australian fintech’s, giving them the tools they need to scale while staying CDR compliant and secure.
Consider Envestnet | Yodlee’s recent partnership with WeMoney, a personal finance app. Through access to digital data access services (non-CDR) and CDR data sources from Australia’s major financial institutions, WeMoney now has a more comprehensive understanding of its customers financial wellbeing and can create better tailored insights and solutions.
The partnership between WeMoney and Envestnet | Yodlee marks the start of accredited companies leveraging in-depth personal data. Whilst Envestnet | Yodlee pioneered the way for Open Banking via digital data capture technology, there is a shift to the regulated framework of CDR instead of user permissioned screen scraping.
The FastLink 4.0 User Interface which launched in Australia in October 2021, lets consumers link all their financial accounts of any type including consent flows for CDR and non-CDR data. By leveraging FastLink, developers can avoid having to build complex UI flows and consent management dashboards as well as provide the ability for customers to link accounts from other countries, such as via US and UK Open Banking.
Another example is the work Envestnet | Yodlee has done with software specialists, Moneythor. Moneythor provides financial institutions across Australia and New Zealand with a digital toolkit to enhance their digital banking services. Envestnet | Yodlee’s data aggregation and analytics platform is allowing Moneythor to enhance its white-labelled product to access consumer-permissioned financial data from more than 100 financial institutions giving its customers a holistic view of their customer’s financial situation.
Ultimately, we can expect the Australian fintech ecosystem to continue its trajectory of rapid growth, with developments in CDR fueling the expansion of innovation in this sector. The fintech sector is projected to continue experiencing growth as Australia is continuously attracting multinational talent from across the globe, with Australia conveniently located on the doorstep of Asia, a key market for innovation. Given the diversity of the Australian fintech market, there are opportunities across a wide variety of subsectors, including payments, wealth management, data analytics, lending, insurtech, regtech, proptech, P2P, blockchain/distributed ledge and neo-banks, amongst others.
Envestnet | Yodlee is at the forefront of this growth, offering a comprehensive CDR and non-CDR data sets, and proactively partnering with financial institutions to provide consumers with better services and more control over their financial data.