Fintech Market Overview

This article does not constitute legal advice.

Banking in Australia

Fintech Software

The regulatory framework applicable to fintech companies includes banking, financial services, consumer credit, consumer protection, data and privacy, payments and anti-money laundering and counter-terrorism financing regulation. The regulatory obligations broadly include licensing and registration requirements, conduct requirements and disclosure requirements.1

There is no fintech-specific licence; however, there are several exemptions that may be suitable for a fintech business to use to test a fintech product or service offering. For example, ASIC offers eligible providers an enhanced regulatory sandbox, which is a 24-month conditional exemption from the requirement to hold an Australian financial services licence (AFSL) to test financial services and products in the Australian market, and an Innovation Hub that offers applicants 12 months of informal guidance on licensing and regulation.1

Any entity that conducts a 'banking business', such as taking deposits or making advances of money, or provides a purchased payment facility, must be licensed as an authorised deposit-taking institution (ADI). The Australian Prudential Regulation Authority (APRA) is responsible for the authorisation process and the granting of ADI licences (as well as ongoing prudential supervision). In 2018, APRA released the restricted ADI framework, which is designed to assist new businesses wishing to enter the banking industry. Under this regime, entities can conduct a limited range of business activities for two years while they build their capabilities and resources. After this time, they must either transition to a full ADI licence and operate without restriction or exit the industry.1

Any entity that conducts a banking business (including certain holders of stored value purchased payment facilities (PPF)) must also be authorised as an ADI.1

Lending in Australia

Fintech in Australia

Fintech in other countries

  1. https://thelawreviews.co.uk/title/the-financial-technology-law-review/australia
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