ASIC to encourage financial technology development – Firms can test their systems and onboard up to 100 retail clients with no license
“”Fintech and start-up businesses now have more pathways than ever to begin testing the viability of innovative financial services and credit services consumers, before incurring many of the regulatory costs normally associated with running their business,” – John Price, Commissioner, ASIC
Just over a year ago, the Financial Conduct Authority (FCA) in Britain launched a regulatory sandbox in which developers of new technology that will form part of London’s top quality financial sector in the future can be tested and developed according to regulatory frameworks.
London is well recognized as the world’s FinTech and institutional R&D center, however Australia’s highly astute and modern regulatory authority, ASIC, has now introduced a development ground for FinTech firms in its jurisdiction, providing developers of eligible FinTech projects with full exemption from the bureaucracy of having to hold an ASIC license at all.
ASIC will allow FinTech firms to test their services for up to 12 months with up to 100 retail clints on the condition that they meet a certain number of consumer protection standards and notify ASIC of their intention to commence their test.
“Fintech and start-up businesses now have more pathways than ever to begin testing the viability of innovative financial services and credit services consumers, before incurring many of the regulatory costs normally associated with running their business,” said ASIC commissioner John Price.
While ASIC may claim that its licensing exemption scheme is new, the concept of regulatory sandboxes is proving increasingly popular as jurisdictions compete to attract fintech startups. This is especially so in Asia Pacific where Malaysia, Hong Kong, Singapore and Thailand have all launched regulatory sandbox schemes this year.
Australia has marked itself out as a top quality region for the FX and electronic trading industry over recent years, its ultra-modern yet very stringent regulator having been instrumental in garnering this particular reputation.
