Select Committee Report - Australia as a Technology and Financial Centre

20 October 2021


Today I also speak on the final report of the Select Committee on Australia as a Technology and Financial Centre Committee. This report provides the committee's findings for its third inquiry into the financial technology and regulatory technology sectors in Australia.

Before I speak to the work of this committee and to this report, I want to start by thanking the chair, Senator Bragg. We have worked well together, I believe. We have found plenty of agreement—probably we've found more disagreement—but I've enjoyed the process and I've enjoyed working with Senator Bragg. I also thank the other members of the committee for their participation in our hearings and deliberations, and the wonderful committee secretariat, particularly Ms Lyn Beverley and Mr CJ Sautelle, who have provided what has been absolutely world-class support to participating senators and their staff. I, for one, have very much appreciated their wisdom, their advice and the support they have provided to the committee.

The first inquiry of this committee sought to investigate the barriers and challenges that Australian fintechs and regtechs are trying to overcome in attempts to grow their enterprises, grow the sector and grow their respective industries. We have identified many challenges that Australian startup fintechs and regtechs are confronting, which have only worsened during the pandemic. In fact, these developments and the economic crisis that has ensued encouraged the committee to resolve to bring forward the tabling of that interim report, so it could immediately deal with COVID related topics, as well as dealing with other evidence that had been provided to the inquiry at that point in time. While there wasn't unanimous agreement for everything in that first interim report, there was much we could agree on, and it provided a solid base for our committee to conduct its following two inquiries. On that note, I would like to pass on a word of thanks to Senator Kitching, who took over from me as deputy chair and oversaw the passage of that second interim report while I welcomed my daughter into the world.

This current report finalised a lot of the work the committee wanted to include in the first report but couldn't because of the need to expediate that first interim report's release in response to the pandemic. Although that report was brought to the Senate by a committee under a different name and terms of reference, the work is relevant here. We expanded the terms of reference of this committee to allow for a broader examination of the fintech sectors here in Australia, and that's where this report comes to today. The major focus of the report was investigation of the policy environment surrounding the cryptocurrency sector in Australia.

This is obviously a huge area of interest for Australians. We've heard and received evidence about the increasing uptake of crypto-assets by everyday Australians, and I note this is especially the case for younger Australians. We heard from stakeholders about why this interest necessitates greater regulatory intervention in the crypto-asset sector to drive further growth and establish Australia as a global leader in financial technology. Most people these days know about bitcoin, but this is just one of the many crypto-offerings out there that are presenting new and ever-evolving challenges and opportunities that countries all over the world are grappling with.

I hope that this report serves as a point to promote greater discussion about this growing sector and how critical it is that as a parliament we ensure that any reform has the best interests of everyday Australian investors and consumers at its heart, that these interests are protected and that we are always thinking about Australians making these investment decisions and making sure that our laws and regulations reflect their needs and interests.

Labor senators provided additional comments to this report which speak to this issue. I note that Senator Bragg said this is a bipartisan report. I'm not sure that's quite true. We have provided additional comments which speak to some of our concerns and some of our policy areas of interest, which I would point to as well. I won't go through them in detail because they're there in the report.

Throughout the proceedings of this committee inquiry, I've been mindful of the need to balance the desire to encourage growth in the fintech and regtech sectors and protecting the needs of consumers and other Australians. Upon the tabling of the first interim report, I noted the responsibility that our government has to ensure, in particular, that the financial literacy needs of Australians are keeping up with the availability of more financial products. This was an ongoing theme throughout all of our inquiries, whether we were talking about buy-now pay-later products, digital finance or cryptocurrency investments. It remains an issue in Australia, and I would like to see more funding and more support for financial literacy so that we can make sure that consumers are protected, that they have the education they're seeking and that these organisations, which provide fantastic services for Australians, are able to support consumers as they need to.

Evidence at all of our hearings suggested that there aren't nearly enough educational tools available for Australians to better understand the digitalised financial products they are seeking to use or invest in. As I've stated previously, not addressing this new phenomenon will only further widen the digital divide that we know exists in our community between those who have access to or an understanding of these technologies, how to benefit from them, use them and apply them, and those who don't. This will only serve to further disenfranchise vulnerable groups in our community who feel shut out of this digital divide. I believe the true opportunity, the true potential, of fintech and regtech will only be fulfilled if their availability results in a narrowing of the digital divide in Australia and brings more people into the fold of being able to participate in those technologies and participate in technology more broadly. To do this, they need access, they need education and we need to make sure that these products are accessible.

I want to conclude my remarks by thanking all the various stakeholders who have participated over the three reports, particularly those who have invited me to see their operations, to visit their businesses and to brief me, whether it was in person or remotely, as the pandemic set in. I've absolutely loved meeting you, talking to you, learning more about your industry and learning about the reform challenge we have ahead of us in Australia to make sure your industry can grow and flourish and to make sure that consumers engaging with your industry are protected and have the right educational tools at their disposal.

Our work as a committee has only been possible because of the evidence that stakeholders provided to us. They often did this through a considerable donation of their time and energy and resources. Many of the people who submitted to this inquiry and came to our hearings had never participated in a Senate process before. I want to thank them for the care and attention they put into their submissions, for taking the time to speak to us in these hearings and also for taking the time to offer personal briefings to make sure that we all had the information we needed as we were considering our inquiry and getting to our report. So thank you for that. In particular, thank you to the South Australian fintechs. I think there's a very promising future for fintech and regtech in our state of South Australia, and I look forward to working with you all to ensure that you have that opportunity to grow your businesses and you are supported by Australian regulation in order to do that.

I know there is so much more that the fintech and regtech sectors will offer over the years to come. I just want to say that in me you have found an admiring ally and an advocate. I look forward to working with you in the future. Thank you for the opportunity to speak on this report. I want to highlight the additional comments from Labor senators reflecting our position and again thank everyone who has been involved in the inquiry for their work and support.