Bureaucracy fumbles Australia’s innovation vision

Australian corporate regulator ASIC’s commissioner, John Price, has called out “innovation” as a concept about which it is easy to wax lyrical, but “difficult to apply in practice”.

Mr Price made the comments at the recent Senate Economics Legislation Committee meeting into the regulatory sandbox for fintechs when asked: “Is an innovation benchmark appropriate?” With just five fintech companies making the grade for the first version of the sandbox, and consumer advocacy group Choice arguing the sandbox needed a higher “innovation” bar to entry, his answer suggests this is a bigger question than the regulatory body can begin to answer.

Mr Price was “not surprised” with the low take-up of the sandbox, citing alternative avenues to licensing already being used. ASIC faces clear challenges in regulating to both foster innovation and protect consumers. Yet this is vital to the future of Australia’s continued economic success as fintechs must comply with regulation before launch. Likewise defining innovation beyond its buzzword connotations is crucial to ongoing development and progress across a broad range of industries.

Fintech Australia and Choice both argued for more oversight on applications to ASIC’s sandbox to allow access for innovative business models or innovative approaches to existing business models that create a benefit to consumers. But the problem of supporting innovation is broader than this. The federal and state governments have been extremely supportive of emerging start-up companies in Australia.

So while we have a clear top-down prioritisation from the country’s leadership that Australian businesses need to innovate, what is not clear is how the government agencies are implementing this.

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Source: Bureaucracy fumbles Australia’s innovation vision – The Australian