The Australian government is preparing to make a number of reforms that accommodate FinTech initiatives to help stimulate innovations for its already sophisticated financial sectors that are underpinned by robust regulatory system. This is according to a nearly 35 page report titled ‘Backing Australian FinTech’ that accompanied a statement from one of its MPs this morning.
The announcement paralleled ASIC’s press release today with proposals and guidelines for robo-advisors, and as both the regulator and government aim to stay up to speed on the fast pace of changes to banking technology and financial markets products.
Through close collaboration, the government’s new FinTech advisory group and the FinTech Australia association will work on new measures that are being created to support the local FinTech industry, as explained by Treasurer Scott Morrison, MP and Cook division member, at a press conference in Canberra this morning.
In a statement following the news published on Fintech.treasury.gov.au, Mr. Morrison said: “FinTech is all about stimulating technological innovation so that financial markets and systems can become more efficient and consumer‑focused. This can help drive improvements in traditional financial services and, perhaps more importantly, promote disruption through innovative new products and services, which can offer benefits to consumers and other sectors of the economy.”
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Mr. Morrison added in the statement: “As Treasurer, I want to help create an environment for Australia’s FinTech sector where it can be both internationally competitive and play a central role in aiding the positive transformation of our economy.”
Some of the measures included making sure that concessional tax treatment was available for venture capital investments into FinTech start-up firms, and addressing the double-tax of GST against digital cryptocurrencies, as there are over 600 digital currencies now in circulation, among other areas noted. The report also praised efforts underway by ASX to examine the use of Blockchain technology within the exchange structure and coincided with the news today of the ASX CEO resigning amid a probe into one of his prior roles with Tabcorp.
The gfovernment is also working with ASIC on creating a ‘regulatory sandbox’ for Australian FinTech companies and to help firms manage regulatory risks during testing stages, and thus reduce the cost and time of marketing products. Some of the interesting points mentioned during the announcement included measures that would allow all companies regardless of their size to be eligible for Equity Crowdfunding and the process to review Australian Market Licence (AML) requirements for crowdfunding intermediaries, as well as changes to the cool-off period providing firms with the ability to cancel an investment for applicable reasons.
The aspects of crowd-funding and peer-to-peer lending also paralleled a concurrent release today from ASIC with regard to lending, after the government’s framework for Crows Sourced Equity Funding (CSEF) from last December.
An excerpt related to crowd funding from of one of the accompanying reports referenced by Treasurer Morrison can be seen below: