The Senate Select Committee has issued its interim report on FinTech and RegTech We chart the path forward
The Australian Senate’s Select Committee on Financial Technology and Regulatory Technology (the Committee), established in September 2019 to inquire into financial technology and regulatory technology (the Inquiry), released its Interim Report on 2 September 2020.
The Inquiry’s remit, already broad in its focus on opportunities and barriers to the uptake and facilitation of new technologies in the financial sector, including FinTech and RegTech start-ups, swiftly pivoted, and expanded in light of the then-unfolding COVID-19 pandemic in March 2020. This has resulted in interim findings and recommendations which are relevant not only to FinTech, RegTech and the financial services sector, but to the digital economy, start-up ecosystem and technology sector more broadly.
The final report of the Inquiry is promised by April 2021.
In the meantime, there are a number of key takeaways from the Interim Report; ours are set out below.
As such, the recommendations made by the Interim Report in relation to Australia’s business tax environment, its support and incentives for innovation, the enhancement of its programs and other incentives for capital investment in start-up companies, its approaches to up-skilling and re-skilling of workers and the impact of its governmental procurement policies and initiatives on small businesses will have wider relevance. Many of the recommendations made in relation to these areas have already been the focus of existing and separate governmental inquiries, initiatives and reviews, and will be welcomed by industry (especially in relation to the enhancements of and clarifications to the Research and Development Tax Incentive, which is critical to many start-ups). However, there are some recommendations that are unlikely, without more, to lead to the changes sought by industry (for example, the recommended changes in relation to expanding the Early Stage Innovation Company regime and encouraging superannuation funds to invest in start-ups).
Ultimately, the Interim Report adds weight, and the support of the Inquiry, to the concerns of many industry stakeholders, but with only a few days left in the Parliamentary calendar for 2020 — and the final report not expected until April — it is not clear whether (or when) its opportunities will be realised.