Australia’s fintech industry today threw its support behind proposals to increase banking competition by making it easier for new market entrants to get bank licences and access bank-held customer financial data.
FinTech Australia said it supported comments made today by David Coleman, the chair of the House of Representatives Standing Committee on Economics which is currently undertaking a review of the four major Australian banks.
Mr Coleman commented on the need to reduce barriers to get new banking licences – given that only one new Australian bank licence has been granted in the past decade – and for government to drive open financial data reforms.
Danielle Szetho, CEO of FinTech Australia, said: “The time has come to reform Australia’s banks to drive increased competition and put customers in control of their data so they can easily and effortlessly shop around for the financial products and services that suit them best.”
“Australia’s fintech industry will not be able to grow and become internationally competitive unless there are less barriers for challengers to enter the banking sector and provide greater choice for consumers.
“As the House Economics Committee has found, there has only been one new banking licence granted in the last decade – to Australia’s only digital challenger bank Tyro – which illustrates just how difficult the current process is.
“As a result, we strongly support the comments made today by Mr Coleman and the recommendations of the Committee, particularly in the knowledge that there is strong bipartisan support for these initiatives.
“We urge the Australian Government to act quickly to kick start this important process, particularly around open financial data and comprehensive credit reporting.”
On the issue of open financial data, Ms Szetho highlighted that FinTech Australia’s most recent submission to the Productivity Commission called for the creation of a cross-industry working group led by government and ASIC to implement the reforms.
This working group would look to resolve a range of issues on open financial data, including security, privacy, liability, accreditation and consumer experience and education.
Writing today in the Australian Financial Review, Mr Coleman said: “Our start-up banking sector is basically non-existent, and we need to change that. We’ve made recommendations that the existing rules related to start-up banking licences be amended, so that we can develop a similar culture to the UK.”
On open financial data, Mr Coleman said an independent body – not the banks – should be given the task of setting the rules for allowing customers to more easily access their own financial data, so they can pass this data to fintech companies with innovative new products.
“The government can’t allow the banks to control the open data rules – they are much too conflicted,” he said.
FinTech Australia’s submission to the Productivity Commission can be found here.
About FinTech Australia
FinTech Australia is a national association for the Australian FinTech Startup community. Our vision is to make Australia the leading market for FinTech Innovation and Investment by working with both sides of Government, Industry and the Australian FinTech community to create a supportive environment and partner ecosystem in Australia and abroad.
Chief Executive Officer