Consumer Data Right Policy and Engagement Branch
Market Conduct and Digital Division
The Treasury
Langton Crescent
PARKES ACT 2600

Re: Submission on the Proposed Ban on Screen Scraping

To whom it may concern,

As the founders of Wagetap and Wagepay, two Wage Advance service providers based in
Australia, we wish to convey our strong commitment to the ideals of Open Banking and the
Consumer Data Right (CDR). We believe that these initiatives hold immense potential for
enhancing the financial well-being of Australian consumers and fostering competition in the
financial services sector. However, it is with an understanding of the current limitations that
we write to express our opposition to the proposal to ban screen scraping.

Our stance reflects the perspective that while Open Banking and the CDR represent a
promising future, their present state remains immature and unprepared for adoption by the
lending industry. We acknowledge that these initiatives have the capacity to address critical
challenges in the financial services ecosystem, yet their effectiveness is hampered by
several unresolved issues. Once these problems are adequately addressed and the
framework matures, Wagetap is fully committed to integrating Open Banking and the CDR
into our operations. Until that time, we urge the reconsideration of the proposed ban on
screen scraping, which, in its current state, serves as a necessary requirement to foster
competition in the lending industry.

Thank you for considering our submission. We are available for any further information or
discussions regarding this matter.

**About us**

This submission is made jointly by two separate and unaffiliated wage advance providers,
[Wagetap and Wagepay. Our products offer eligible consumers a cheaper and fairer](http://www.wagetap.com/)
alternative to payday (SACC) loans by offering an advance of up to $2,000 on their wage for
a low fee. During the application process, we require users to allow us access to their
banking data using screen scraping.


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**Submission**

The argument for banning screen scraping is built upon three key assumptions, each of
which warrants reconsideration:

**Assumption 1: The CDR is mature and could substitute for screen scraping in most**
**use cases.**

Regrettably, the current state of the Consumer Data Right (CDR) suggests that it remains in
an immature stage, rendering it unsuitable as a direct substitute for screen scraping,
particularly in cases relevant to lenders. Several reasons support this assertion:

-  The CDR faces significant challenges concerning consumer adoption, data quality,

and regulatory burdens. These challenges make it practically infeasible for many
lenders to transition seamlessly to the CDR.

-  The complex and daunting consent process within the CDR framework has proven

intimidating for consumers, hindering its widespread acceptance.

-  Persistent data quality issues are of particular concern, especially for lenders, given

the potential impact on credit decisions and the potential for consumer harm if
inappropriate lending decisions are made based on incorrect or insufficient data.
There are many reports of poor data quality, including inaccurate transaction
descriptions containing special random characters, and miscategorisation of fund
transfers.

-  The information accessible under the CDR regime is insufficient for most lenders to

use. Using screen scraping, entire bank statements are collected and additional
fields such as category information are automatically collected. These information is
critical for lenders to meet their responsible lending obligations. However, these fields
are optional under the CDR regime.

-  The substantial operational and financial burden associated with CDR accreditation,

as well as the ongoing administrative and compliance requirements, presents a
significant obstacle, particularly for smaller lenders. CDR may only be a viable option
for large lenders, forcing smaller lenders to exit the market and lessen competition, a
poor outcome for consumers.

It is essential to underscore that credit providers have advocated for the establishment of a
more streamlined and effective Open Banking regime to address these concerns. A wellimplemented Open Banking framework would garner the support of most lenders and enable
them to transition from screen scraping to more modern and secure practices, provided that
the aforementioned issues are effectively addressed.

**Assumption 2: CDR uptake by lenders and customers has been impeded by the**
**continued availability of screen scraping**

Contrary to the assertion that the availability of screen scraping significantly hinders CDR
adoption, we contend that the impediments to CDR implementation extend beyond the
continued presence of screen scraping. These challenges are diverse and require nuanced
solutions that do not necessitate the prohibition of screen scraping.


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**Assumption 3: There are substantial security risks associated with screen scraping,**
**most notably the risk that customer internet banking login details are leaked**

While the potential security risks associated with screen scraping have been raised, it is
important to note that these concerns may have been overstated. Screen scraping, as a
method of bank data capture and aggregation, has been a trusted and predominant practice
globally for over 15 years. Importantly, no instances of credential leaks have been reported
by reputable, large-scale providers of screen scraping services.

To address specific security concerns, it is conceivable to regulate and prohibit higher-risk
activities undertaken by some screen scraping vendors, such as the unauthorized storage of
bank login credentials, whether encrypted or not.

In addition to the addressing the three key assumptions above, we would also submit that
forcing lenders to migrate the CDR would lesson competition.

**Compelling lenders to use the current iteration of the CDR would lessen competition**
**in lending markets**

Screen scraping has played a pivotal role in enabling non-bank lenders and smaller
Authorised Deposit-Taking Institutions (ADIs) to compete with major banks while adhering to
responsible lending obligations. Mandating a transition to the current iteration of the CDR
would have adverse consequences:

-  Lenders would be compelled to impose onerous additional data requests on loan

applicants, including the submission of electronic or paper bank statements to
validate income, expenses, and other financial liabilities. Major banks do not face a
similar necessity as they already possess access to this data.

-  Increased fraudulent activities would be encountered due to the proliferation of

fraudulent electronic and paper bank statements, thus elevating fraud losses.

This proposed transition would fundamentally impair the ability of most non-major bank
lenders to compete with major banks, who have a substantial advantage in terms of access
to existing customer data, offering a more streamlined and expedited service. This would
directly contradict the key policy motivation for introducing the CDR, which was to promote
competition and innovation in the Australian financial services sector.

In conclusion, it is our hope that this submission offers a more comprehensive perspective
on the proposal to ban screen scraping. We emphasise our commitment to the principles of
Open Banking and the Consumer Data Right but acknowledge the current immaturity of
these initiatives. Until such time as the inherent issues are resolved and a more robust
framework is in place, we strongly urge a reconsideration of the proposed ban on screen
scraping. This approach would ensure that the lending industry maintains its
competitiveness, while also fostering the development of a truly innovative and consumerfocused financial ecosystem.

Thank you for considering our submission. We remain at your disposal for any further
information or discussions pertaining to this matter.


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Sincerely,

Mitchell Stevens
CEO
Wagetap
[www.wagetap.com](http://www.wagetap.com/)
mitchell.stevens@wagetap.com
+614 33 515 028

Tony Chan
CEO
Wagepay
Level 1, 200 Mary Street,
BRISBANE CITY QLD 4000
[www.wagepay.com.au](http://www.wagepay.com.au/)
[tony@wagepay.com.au](mailto:tony@wagepay.com.au)
+61411 193 932


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