Our latest #Bitesize round-up covers key recent FinTech, payments, Open Banking-related regulatory developments in Australia.
FinTech and Payments
ASIC releases updated ePayments Codeoard
On 2 June 2022, ASIC published the updated ePayments Code to clarify and enhance existing protections for consumers. The update now includes payments made under the New Payments Platform.
ASIC has also updated the following areas of the ePayments Code:
- compliance monitoring and data collection;
- mistaken internet payments;
- unauthorised transactions;
- complaints handling; and
- facility expiry dates.
ASIC's most recent review culminated in Report 718: Response to submissions on CP 341 Review of the ePayments Code: Further consultation (REP 718), which was published in March 2022.
The media release is available here.
The latest version of the ePayments Code is available here.
REP 718 is available here.
Buy now, pay later sector to be regulated under credit laws
On 8 June 2022, the media reported that the Albanese government will begin to regulate the buy now, pay later (BNPL) sector under credit laws.
Financial services minster Stephen Jones was reported as saying that BNPL products are a "good innovation in the credit market". He wanted to address the deficiencies identified from the 2019 Hayne Royal Commission's inquiry and implement those reforms proposed by the Commissioner. He added that the government would work with ASIC to regulate the BNPL sector.
Government moves to regulate cryptocurrency exchanges
On 8 June 2022, the financial services minster Stephen Jones was reported as saying that the Albanese government will begin to regulate cryptocurrency exchanges in the same way as other financial markets.
Mr Jones said the goal is to introduce transparency in the trading of cryptocurrency. He said the new government will continue a consultation process about regulating cryptocurrencies. Two questions will be addressed, namely, "whether and how cryptocurrency as a product is regulated in our financial services system – is it regulated as a financial product?" and "if there is a standalone way of recognising and regulating".
RBA releases the 2022 Assessment of the Reserve Bank Information and Transfer System
On 15 June 2022, RBA released the 2022 Assessment of the Reserve Bank Information and Transfer System (RITS) – Australia's real-time gross settlement system – against the Principles for Financial Market Infrastructures (PFMI). The PFMI are international standards developed by the Committee on Payment and Market Infrastructures and the Technical Committee of the International Organization of Securities Commissions.
The Assessment concludes that RITS observed all relevant Principles as at 31 March 2022, except for the Principle on operational risk. To observe Principle 17 (Operational risk), RBA's Payments Policy Department recommends that RBA should complete work currently underway to improve and refine the metrics used to measure the operational resilience and stability of IT systems supporting RITS.
RITS is Australia's high-value payments system, which is used by banks and other approved institutions to settle their payment obligations on a real-time gross settlement basis. The Assessment was independently prepared by RBA's Payments Policy Department and approved by the Payments System Board.
The media release is available here.
The Assessment is available here.
Open Banking and the Consumer Data Right
ACCC notes Australians made increased losses to investment scams
On 6 June 2022, the Australian Competition and Consumer Commission (ACCC) reported an increase in money lost to investment scams.
The ACCC noted from new Scamwatch data that Australians made a $158 million loss, which is a 314% increase, in investment related scams. Moreover, only approximately 13% of all losses were reported to Scamwatch, indicating that actual numbers are likely to be much higher.
The ACCC highlighted that Scamwatch data also showed the number of reports were lower overall, meaning there is a higher average loss per individual. ACCC Deputy Chair Delia Rickard said the majority of losses were attributed to crypto investment scams, though there were also increases in imposter bond scams, representing $10.9 million in losses.
The media release is available here
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