The debate regarding Fintech revolution almost always includes a discussion of regulation. And it should. The financial industry is one of the most regulated sectors of commerce there is. But as Fintech has evolved an emerging ecosystem of firms seeking to facilitate regulatory compliance has moved in to help fuel sector growth.
At the inaugural Fintech Australia Summit this month, Scott Morrison MP, the Treasurer of Australia, delivered a speech that addressed this “collision” between Regtech and financial innovation.
Regtech, in Morrison’s opinion, can seamlessly integrate into financial firms creating a “compliance by design” environment where risks can be mitigated as everything is monitored in real-time.
Morrison believes;
“A proactive Regtech agenda builds on these initiatives to strengthen our banking and financial system and thereby increase our economic resilience.”
Morrison stated that Fintech will transform the economy while helping to drive wages higher and improve living standards for all Australians. He said Australia is committed to Fintech and called it “a key component of our national plan for jobs.”
Applying Regtech to Fintech may ease the burden of the highly regulated industry;
“…we cannot allow our financial regulatory framework to act as a handbrake to this innovation. Excessively stringent rules and obligations result in less business, less competition and ultimately worse outcomes for consumers. RegTech can equip us to avoid these outcomes.”
It is an interesting thesis and another path to mitigate rules designed for an analog era.
Australia has already embraced the Sandbox approach as initiated by the UK. The Treasury has crafted a page that outlines the governments Fintech priorities as it pushes forward into the era of internet finance.
The Aussie government wants to help create an ecosystem for Fintech where it can be internationally competitive, and where it can boost the economy. Elected officials “want to see Fintech in Australia become a locus of creative thinking and business activity.”
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