Prospa welcomes the Senate select committee on financial technology and regulatory technology’s interim report

Prospa welcomes the interim report published by the Senate Select Committee on Financial Technology and Regulatory Technology on 2 September 2020. The Senate resolved to establish the committee on 11 September 2019 to inquire and report on:

• the size and scope of the opportunity for Australian consumers and business arising from financial technology (FinTech) and regulatory technology (RegTech);
• barriers to the uptake of new technologies in the financial sector;
• the progress of FinTech facilitation reform and the benchmarking of comparable global regimes;
• current RegTech practices and the opportunities for the RegTech industry to strengthen compliance but also reduce costs;
• the effectiveness of current initiatives in promoting a positive environment for FinTech and RegTech start-ups; and
• any related matters.

Prospa was an active participant in the proceedings, making several submissions to the committee during the process and attending key round table session with industry and Inquiry lead Scott Farrell. Prospa was an advocate for many of the recommendations outlined in the interim report.

Prospa’s submissions to the committee focused on addressing the opportunities arising from fintech for small businesses, barriers to the uptake of technology in financial services and the progress of regulatory reforms. Submissions also covered important Policy issues including the Consumer Data Right, the shortage of talent needed to facilitate growth companies and timely, digital access to government data.

Anna Fitzgerald, Group Head of Corporate Affairs at Prospa said:

“We’re pleased with the findings of the senate committee’s interim report on Financial Technology and Regulatory Technology. In particular, we’re impressed with the focus on ensuring regulators support competition and innovation in the market.

“We support a clear consistent pro-innovation regulatory environment with appropriate levels of regulation. As a founding signatory of AFIA’s Code of Lending Practice, we’ve experienced firsthand that self-regulation is an efficient way to encourage industry to improve competitiveness by focusing on investment in innovation to deliver better customer outcomes.

“In relation to Open Banking, we will continue to advocate for an implementation committee that is appropriately empowered to ensure timely implementation of Consumer Data Right and Open Banking. We support  maximising participation across the economy. That means sorting out how fintechs can access customer data, either directly or through third parties, sooner rather than later.

“Importantly, we strongly recommend the Consumer Data Right be expanded to include the ability to initiate payments, also known as ‘write-access’. Write access is critical to enabling fintechs to develop truly innovative products and services, and to alleviate the barriers small businesses face when switching providers. A simple analogy: not having write-access is like having a new phone that can receive calls but not make them, so you need to pick up your original phone to make a call, pay two sets of monthly fees and keep track of which phone numbers and photos, for example, are stored in which phone. What’s the incentive to get that new phone?

“We also urge the Government to continue to support innovation in Australia by urgently reviewing the changes to the R&DTI currently under consideration by the Senate Economics Legislation Committee. Australia needs to encourage technology innovation and with appropriate support, the tech sector will play a pivotal role in driving future economic growth.”

The reporting date has been extended from the first sitting day in October 2020 to 16 April 2021.