Australia’s fintech industry body has welcomed proposals for open data reforms, digital currency tax cuts, and reduced barriers for banking licenses handed down this week in the 2017 Federal Budget.
Commenting on the provisions for fintech set out by Treasurer Scott Morrison on Tuesday, Fintech Australia chief executive, Danielle Szetho declared the budget a winner that would assist alternative finance entrepreneurs to challenge the big banks.
Within the Budget, there would be help to improve fintech’s access to positive credit data to provide more choices for consumers, with the announcement of the legislation of a mandatory comprehensive credit reporting regime, if credit providers are not providing above the 40 per cent benchmark of data information at the end of the calendar.
The government had also signalled its support for the Productivity Commission’s recommendation to scrap the double taxation of bitcoin. Moving forward, digital currencies would be treated as a financial supply for GST purposes.
“We welcome these initiatives – they’re a huge step forward when it comes to growing a globally competitive Australian fintech industry, that will also deliver greater choice and improved financial outcomes for consumers,” Szetho said.
Szetho said the fintech industry would benefit from the proposed expansion of Australia’s fintech regulatory sandbox from 12 to 24 months for the testing of fintech products. The government would also introduce an open banking regime, along with a restructured policy framework to allow fintech firms to easily access bank customer data by 2018, in the wake of a review to be conducted this year.
Steps to reduce barriers or fintechs to move into the realm of “challenger banks” have also come into play, with the change of current bank shareholder restrictions; financial institutions with less than $50 million in capital would also be able to define themselves as banks.
Szetho said the industry body remained committed to supporting the government in developing initiatives for the fintech industry which would include further overhauls to regulation.
“We will also be seeking to work closely with the government as it establishes the new Australian Financial Complaints Authority,” she said.
[This is] to ensure it provides a fair and low-cost outcome for fintech firms who will be subject to its activities.”
