In announcing its Strategic Plan for Australia’s Payments System, Treasury has provided the clearest direction to date on how it plans to modernize and revamp the regulatory framework for payments in Australia. It outlines the Australian Government’s key priorities and initiatives for modernizing and regulating payments systems in coming years. This announcement follows a very broad consultation on its strategic plan and a number of reviews undertaken in this space.

By 29 February 2024, all Australian financial services licensees that provide financial services to retail clients and Australian credit licensees must for the first time submit internal dispute resolution (IDR) data reports to ASIC covering the six month reporting period 1 July to 31 December 2023.

In brief The assistant Treasurer and Minister for Financial Services Minister Stephen Jones addressed the annual Responsible Lending & Borrowing Summit in Sydney. His speech is available here. His speech announced that Buy Now, Pay Later (BNPL) payment arrangements will be regulated as credit and enforced by the Australian Securities and…

The Australian Securities and Investments Commission has provided updated guidance on the updated breach reporting regime applicable to Australian Financial Services Licensees and Credit Licensees. ASIC’s updated guidance is set out in a new version of Regulatory Guide 78, ‘Breach Reporting by AFS Licensees and Credit Licensees’ (RG 78), published 27 April 2023.

The Federal Court’s recent decision in Australian Securities and Investments Commission (ASIC) v Scholz (No 2) [2022] FCA 1542 has important implications for those who discuss financial products and services on social media platforms. Handed down on 20 December 2022, the Court’s judgment heralds a warning that social media ‘finfluencers’ may be considered to be carrying on a financial service business and thus are required to have an Australian Financial Services License.

The Australian Government has released its Strategic Plan for Payments System: Consultation Paper. It is significant insofar as it demonstrates the current Government’s commitment to reform by creating a fit-for-purpose regulatory framework in respect of payments mirroring international developments. It is also significant in that the paper expressly states that the reform agenda includes implementing a tiered licensing framework for payment services providers. Interested parties are invited to comment on this consultation. Responses are due on 6 February 2022.

The Australian Securities and Investments Commission has been strict in monitoring compliance with the new product design and distribution obligations (DDO), which were introduced on 5 October 2021. Under these DDO obligations, issuers are required to design financial products to meet consumer needs and distribute their products in a clearly-defined, targeted manner. To date, seventeen DDO interim stop orders have been issued by ASIC. Nine interim stop orders have been lifted after ASIC’s concerns were addressed by the entities or where the products were withdrawn, and six remain in place.

On 21 November 2022, the Treasury put out a call for submissions to assist with developing the Federal Government’s regulatory framework for buy now, pay later (BNPL) arrangements. The released options paper seeks to address the purported lack of oversight of the BNPL industry which has so far not been regulated in the same way as other forms of consumer credit under the National Consumer Credit Protection Act 2009. Pending stakeholder review, the paper seeks to strengthen the regulatory framework surrounding BNPL products and depending on the option adopted, may see them subject to the same regulations as credit cards or loan facilities.