ASIC FINANCIAL INNOVATION Sydney Fintech Meetup Startups Tuesday

ASIC & FINANCIAL INNOVATION Sydney Fintech Meet-up: Startups Tuesday 15 September 2015 John Price, Commissioner Mark Adams, Senior Executive Leader, Strategic Intelligence

Outline • Part 1 – Setting the scene – John Price • ASIC’s role • Why regulation • ASIC’s Innovation Hub • Part 2 – Framework and issues – Mark Adams • • • Starting a business The regulation of financial services Licensing Business models: Some issues Questions

ASIC’s role • ASIC’s strategic objectives • Relationship with other regulators

Why regulation • Promote trust and confidence • Promote fair treatment • Promote financial stability

Our experience with Innovation • We are seeing innovative business models • Compared to incumbents, innovators have: • Limited resources • Limited history with ASIC • Some fintechs may also test the boundaries

ASIC’s Innovation Hub • The Hub will assist fintech start-ups to navigate our regulatory system • Consistent with cutting red-tape • ASIC will not compromise fundamental principles of regulation or licensing

ASIC’s Innovation Hub: 5 point approach • Engagement • Streamlined approach • Enhanced communication • Coordination • Establish an advisory committee

What we have done so far • A coordination team • Webpage, guidance and email address • Digital Finance Advisory Committee (DFAC)

Preliminary assistance Marketplace Lending 6 Robo Advice 9 Payments 6 Crowd Sourced Equity Funding 5 Markets 2 Other 6 Total 34

What we expect of you • If seeking informal assistance: • • Have a well developed business model Explain why innovative Explain why benefits consumers/investors Identified regulatory issues

Outline – Part 2 • • • Starting a business Regulation of financial services Licensing Business models – some issues Questions

Starting a business • ASIC’s Small Business Hub o Business name registration o Company registration • IP Australia – for trademarks

Financial Services Framework • • • Financial Services Financial Products Financial Markets Consumer Credit Wholesale and/or retail services

Licensing – some issues • Corporate authorised representative? • Tailored form of licence • Organisational competency

Licensing process • • Application Completeness check Additional information Decision

Robo Advice • Potential consumer/investor benefits • Regulatory issues: o Factual/General or personal advice o Scaled advice o Best interests duty

Marketplace lending • Potential investor/borrower benefits • Regulatory issues: • Disclosure • Creditworthiness • Conflicts of Interest

Crowd Sourced Equity Fundraising • Watch this space • Status of regulatory reforms • Likely elements of the reforms: • Intermediary licensing and obligations • Disclosure • Caps

Payments • • Regulator cooperation e. Payments Code Digital currency: regulatory status Blockchain technology: potential

Questions? Web: www. asic. gov. au/for-business/yourbusiness/innovation-hub/ Email: innovationhub@asic. gov. au