With petrol prices rising, are you filling up on the best day of the week?

Are you subscribing to too many streaming services?

And how much are you actually spending on home delivery?

An emerging breed of AI-driven fintechs can tell you all of this and more – simply by looking at your account and credit card statements.

It’s all thanks to open banking, the Consumer Data Right (CDR)-driven framework that empowers you to tell your bank to share your financial data with fintechs eager to help analyse your spending.

CDR is already being used for purposes as diverse as avoiding bill payment failures and tracing COVID contacts – but with Australia’s open-banking regime luring new entrants like Israeli personal financial management (PFM) company Personetics, the possibilities are growing rapidly.

CDR is “a massive accelerator for our business” and “the most compelling reason why we want to double down in Australia”, Personetics Australian country manager Mandeep Sandhu told Information Age.

Personetics, whose AI-driven software helps conventional banks operate more like data-driven neobanks, has sold its platform to more than 80 traditional banks including Santander, UOB, and Metro Bank.

With a $119m ($US85m) venture-capital war chest, it is now expanding to Australia on the back of contracts with MyStateBank and two newly-signed other customers.

Personetics’s algorithms provide proactive advice about customers’ financial health, spending, and consumption habits.

Its auto-saving features can figure out when you have extra cash sitting around, and prompt you to stash it in a savings account or superannuation fund.

With the right permissions, the platform can even transfer the funds on your behalf.

Add in other data sources, and the possibilities rapidly expand: the PFM platform could track your petrol spending, for example, and cross-match this with petrol price trackers to see if you could save by filling up on days when prices are lower.

It might do an inventory of your streaming services and other subscriptions, tracking your spend and, eventually, cross-matching it with your usage to advise which services you can safely cancel.

The sky is the limit for “hyper-personalisation” services that become viable only with access to relevant, real-time data, Sandhu said.

“CDR is one major utility that is going to help growth for the industry and help customers banking with an institution – and there’s nothing quite like it in the world.”

Data driving sector innovation

Amidst growing inflation, many workers are struggling to make ends meet – and are changing their financial behaviour accordingly.

One recent PwC survey found that 65 per cent of employees have changed their spending behaviour over the past 12 months, with 53 per cent reducing the cost of essential items and 43 per cent saving more than in the past.

Fully 87 per cent of respondents said they want help with financial decision-making.

That could see strong adoption of CDR-driven services that will facilitate sharing of financial data – and will soon be extended to the energy sector to help consumers make better-informed choices of service provider.

CDR will then expand to telecommunications, the government recently announced, with ‘open finance’ – an ecosystem comprising the non-bank elements of the financial-services industry, such as superannuation and insurance providers – to follow.

The Australian government’s sector-by-sector approach “super smart”, according to Sandhu.

“Proactively looking industry-by-industry lets you understand how people spend,” he explained.

“You can build a real profile around that – and, more importantly for you as a customer, you want control over that information and how you use it.”

Australian banks and fintechs have been investing heavily in data tools to make them more responsive and flexible.

Judo Bank, for one, recently implemented a major cloud-based CRM system within months, while the Commonwealth Bank invested in open-banking fintech Payble, and Bendigo and Adelaide Bank bought Melbourne-based fintech Feroci – all to deliver new data-driven insights.

Australia’s heavily-entrenched banks could suffer if they can’t keep up with fintechs, with Accenture predicting that easier bank switching could threaten 29 per cent of banks’ traditional retail products – but boost revenues by 10 per cent for institutions that successfully rethink their business models.