Extending the Consumer Data Right (CDR) to superannuation and pensions information would help increase consumer confidence but trustees may lose some control in the way they engage with members, according to QMV.
A recent Senate inquiry suggested that the CDR – a competition policy to ensure individuals have the right to access and review data held by iinstitutions related to them – be extended to super and pensions.
The consulting service and tech firm’s legal partner, Jonathan Steffanoni, said this would lead to the development of innovative self-service financial planning tools which would benefit consumers and reduce the costs associated with comprehensive financial planning.
However, Steffanoni said it would inherently introduce the strategic risk of asymmetric competition.
“[This has the] possibility of third-party applications being developed to occupy the space between members and super trustees. This would see superannuation trustees losing some control over the way in which they interact with members,” he said.
“Another prominent risk is reputational, with a growing public awareness and sensitivity about the ethics and economics surrounding the use of personal data. Super trustees will need to be aware of the risks of perceived inappropriate use of member data when personalising engagements and services.”
Steffanoni noted that trustees would need to ensure accuracy, quality, timeliness, and completeness of data as there would be civil penalties associated with data holders failing to do so.
“The use of existing standards and infrastructure, including the Australian Taxation Office’s (ATO’s) Member Account Attribute Service and Member Account Transaction Service reporting mechanisms – might mitigate some of the implementation challenges,” he said.
He said before implementing CDR the sector would need adequate consultation, and a gradual approach to transition to ensure adequate planning and oversight by regulatory bodies including the Australian Competition and Consumer Commission (ACCC).
“While data sharing is not new, the Consumer Data Right will result in consumers having greater control and confidence over their personal data, how it is used, and what they choose to share.”