The Prime Minister, Scott Morrison, and the Treasurer, Josh Frydenberg, announced on 29 September 2020 the JobMaker Digital Business Plan, which included a suite of measures designed to accelerate Australia’s recovery from the economic impacts of the COVID-19 pandemic. A key element of this package included reviewing the regulatory architecture of the Australian payments system.

The payments system plays a key role in the Australian economy. It facilitates Australia’s economic activity by providing a safe, efficient and effective way for Australians to exchange money for goods and services. Over time, the payments system has expanded in size and complexity to such an extent that it should be thought of as the payments ecosystem. Technology has enabled new methods of payment and has led to the entry of a range of new providers offering new services using traditional payment infrastructures. Consumers are also adopting digital payment methods in record numbers, further accelerating the transformation in the payments ecosystem towards greater digitalisation.

Despite significant changes to the payments ecosystem, the regulatory architecture, which includes a range of regulatory agencies, industry bodies and the government, has remained relatively unchanged for over two decades. It is vital that the regulatory architecture supporting our payments system can continue to instil confidence and protect the security of the system while promoting innovation and competition in a way that enhances the user experience.

This review was asked to investigate whether the regulatory architecture of the Australian payments system remains fit-for-purpose and responsive to advances in payments technology and changes in consumer demand. This includes investigating whether the regulatory framework adequately accommodates new and innovative services and its effectiveness in facilitating the implementation of government policy.

The review was also tasked with examining how the regulatory architecture could create more productivity-enhancing innovation and competition, increase the understanding of alternative payment methods, and ensure government agencies are well-placed to take advantage of new payment functionalities to enhance service delivery.


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