The Australian Government is promising a root and branch reform of the nation's financial sector, ushering in new legislation for crowdfunding, interchange fee reductions, improvements to data sharing and competition in the supply of digital identities.
In outlining its response to a 2014 Financial Systems Inquiry report, the Government states: "The financial system, like so many other parts of our lives, is being transformed by technological change, innovation and globalisation. If Australia fails to adapt to these developments, to take the opportunities they present while managing evolving risks we will fall behind the rest of the world."
The FSI report, led by David Murray, suggested a raft of measures to improve the resilience of the financial system, encourage innovation and improve consumer outcomes. Chief among the recommendations were the development of a national strategy for a federated model of digital identities, the introduction of a fairer system for interchange fees and surcharging, the creation of a regulatory framework to encourage crowdfunding and alternative sources of finance, and the establishment of an Innovation Collaboration Committee to unlock productivity improvements for emerging firms and startups.
In response, the Government says it will set up a private-public sector taskforce to establish a framework and standards for a national ID scheme, alleviating the reliance on paper-based documentation for the verification of consumer identities. An Innovation Collaboration committee will also be established with links to Asic's Digital Finance Advisory Committee to create a gateway for startups to converse with public and regulatory authorities.
Other actions related to crowdfunding, improved access to bank datasets and interchange fees are also to be pushed through with the aim of unlocking 'significant efficiency improvements' across the financial sector, says the Government.