How does CDR apply to the Innovation of Advice and Client Service Offerings?

Simply becoming accredited under CDR will not improve an organisation’s competitive advantage. Instead, the CDR drives organisations to build end-to-end customer journeys that solve real problems in real-time.

While the data is valuable, it’s actually what can be done with open banking data that is of greatest value to Advisers and their clients. Innovation will occur through partnerships between Advisers and Tech organisations that have built automation using the raw and derived data that open banking provides.

For Advisers who are Authorised as a Trusted Adviser under a sponsorship with an Accredited Data Recipient, the main benefit of CDR will be in the form of partnering with tech providers who can support them to use raw and derived data to:

  • Better understand their clients’ needs, wants and habits through their behaviours
  • Enhance the client experience through personalisation
  • Innovate on new service offerings
  • Provide more timely client service
  • Meet shifting client demands
  • Optimise processes and reduce costs of providing service
  • Streamline compliance management

How does CDR apply to the Innovation of Advice and Client Service Offerings?

Technology that interfaces with Open Banking will support Advisers to become more efficient in the management of data and provision of their client service.

By using technology that integrates with open banking, Advisers can innovate their customer experience journeys by streamlining client onboarding, review and service processes. The potential to create less cumbersome and time consuming interactions for clients through the automation and pre-population of accurate data collection and analysis.

Automating the population of a fact find for a client is one example, but further than this, automation through open banking would allow for the constant updating of that information in real-time. Another example is the pre–population of data in product comparison tools and strategy projection software on a continuous and live basis.

This could help to drive efficiencies of scale, reduce human error within advice processes and compliance requirements.

Innovation through Real-Time Data, Real-Time Advice.

One of the key benefits of CDR is the provision of real-time data.

Technology that integrates with Open Banking to use this real-time data has the potential to provide an Adviser with incredible insight into a client’s financial situation in real-time, which would facilitate better decision making and outcomes for clients.

Real-time derived data can support the innovation of client communication, strategy recommendations and advice delivery. Instead of being limited to the static observations of direct raw data, derived data brings raw data to life creating new data points, new scenarios and models.

Real-time raw and derived data will drive new technology that will allow Advisers to respond in real-time to the changing financial circumstances of their clients. Real-time data insights will allow Advisers to tailor their offering to individuals based on the raw and derived data they receive.

If an Adviser is using technology that embraces the transparency, and insights that CDR can provide, they will be able to use this data to create more efficient business processes and client interactions.

Access to data in real-time will enable Advisers to have more meaningful advice conversations based on real-time financial and behavioural information. As information is constantly pre-populated in real-time, Advisers could provide advice that is more timely and suitable by monitoring their clients’ finances on an ongoing basis.

With automation alerts, triggers can flag when a client’s financial circumstances change, or when they can afford a new investment or property, or have enough funds to be able to invest in their recommended portfolio.

Over time as the industries that use CDR open to wealth management, insurance and superannuation, this will increase the level of data and advice opportunities that can be generated from the data-driven insights.

Next Steps

There are a number of steps that an Adviser can take to prepare themselves and their business for CDR including:

  • Familiarise yourself with the CDR and Open Banking system.
  • Start investigating Unrestricted ADR providers willing to offer sponsorship as a Trusted Adviser.
  • Consider innovation. Identify the processes and procedures in your onboarding, communication and advice process that could benefit from data-driven insights.
  • Review ADR providers that are offering innovative solutions to enhance the ability for you to access data in real-time.
  • Look to partner with ADR providers that will support you to innovate your client service offering and advice model.
  • As a Trusted Adviser data recipient you will be required to operate a CDR data environment that complies with the Rules. This means having effectively designed security controls implemented in the business to protect the integrity of data, privacy of clients and safe storage, use and application of data.
  • Review your IT systems to ensure they meet minimum security requirements to prove they are able to protect CDR data from misuse, loss, and unauthorised access and use.

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