Asic extends Innovation Hub initiative

Asic extends Innovation Hub initiative

An 'Innovation Hub' established by Australian financial watchdog Asic to help fintech startups navigate the regulatory landscape is reporting strong demand for its services from budding businesses keen to break into financial services.

The Hub, established in Arpil 2015, has so far held 32 external meetings with new fintech businesses and industry organisations, of which 22 involved applications for licences and requests for guidance.

Asic Commissioner John Price says: ‘Asic is committed to encouraging innovation, particularly where it can lead to better consumer and market outcomes. However, Asic will not compromise the fundamental principles of financial services regulation. We continue to prioritise appropriate regulation to promote consumer and investor trust and confidence."

To that end Asic has established internal working groups in relation to automated financial advice, crowd-sourced equity funding and digital marketplace lending.

The body has also released new webpages for fintech businesses that are developing financial products or services, with information on how Asic will assess requests for assistance, the kinds of assistance it will provide - including guidance to fintech start-ups on the regulatory framework and licensing processes - and a request for assistance form.

Says Price: ‘Informal guidance from Asic will help new businesses consider the important regulatory issues early. This will allow innovators to resolve problems and minimise the time and cost of applying for licences or relief from the law.’

The watchdog has also established a Digital Finance Advisory Committee (DFAC) to advise Asic on its Innovation Hub initiative and its engagement with innovative businesses more broadly.

The initial members of DFAC are drawn from a cross-section of the fintech community, as well as academia and consumer backgrounds and will meet for the first time this month.

Asutralia is not alone in opening doors to potentially disruptive innovation in financial services from small startups. In October 2014, the UK's Financial Conduct Authority opened its own Innovation Hub to help speed the licensing of new challenger banks and provide help to new entrants to understand the regulatory framework and how it applies.

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