Australia could lose its standing at the forefront of the fintech revolution if the big banks are allowed to retain control of customer transaction data.

In its submission to the Productivity Commission Inquiry into Data Availability and Use, Tyro warned that governments and regulators around the world are competing to redesign their policies and regulations as a reaction to market crises and digital disruption.

Tyro co-founder Andrew Rothwell said the UK and the EU are well-advanced with their Open Data and Open API movement, and that Australia is lagging behind.

“If Australia is late in delivering Open Data and Open API reforms in this country, the fintech revolution will take place elsewhere,” Rothwell said.

“Fintech investment around the world reached an estimated US$20 billion in 2015, a jump of about seven-fold in only three years.

“Customers are currently being locked out of financial services products and solutions such as alternative lenders or comparison, advisory, financial management and payment services that are designed specifically to meet their needs by innovators who can deliver.

Read Tyro’s full submission to the Productivity Commission Inquiry into Data Availability and Use here.

“Customer transaction data belongs to the customer. Banks should be forced to give their customers the right and the ability to share that data with third parties that are licensed under the Australian Prudential Regulation Authority or who have an Australian Financial Services Licence or an Australian Credit Licence.

“By refusing to allow customers to make their data and accounts available to regulated third parties, banks will continue to control the snail’s pace of innovation in Australia – to the detriment of the Australian consumer.”

Rothwell said that banks offering open access to data and external APIs would also benefit because it would enable them to become more of a ‘platform’ for other services.

“Once fintech innovators have been granted permission to analyse, integrate and share data as consumers see fit, they will unleash a vast wave of new products that will give consumers more choice, while increasing the value of their existing products,” he said.

“This industry is going to revolutionise how consumers and businesses interact in the future.

“If Australia is going to become the next fintech Hub of Asia, that revolution needs to happen here.”

Read Tyro’s full submission to the Productivity Commission Inquiry into Data Availability and Use here.