The Australian Securities and Investments Commission (ASIC) has signed an agreement with the United Arab Emirates’ Abu Dhabi Global Market (ADGM) Financial Services Regulatory Authority (FSRA), which outlines how both nations will collaborate to support fintech startups.
Under the agreement, both the FSRA and ASIC will look to connect startups in the fintech space together for advice and potential collaboration opportunities to help them navigate their local regulatory frameworks. Referrals will be facilitated through ASIC’s regulatory assistance body, the Innovation Hub, and ADGM’s equivalent, RegLab.
An information channel will also be established between both organisations, allowing both the FSRA and ASIC to stay informed about shifts in the local economic and commercial sectors of each nation. This information will then be funneled to help Australia frame its regulatory approach in line with international trends.
Penning the agreement, ASIC Chariman Greg Medcraft said the deal would be key to equipping Australian fintechs with the support and knowledge they need to expand into a region “ripe” for new developments.
“Fintech developments are not confined by national borders. Each country and region has a different experience with fintech, and there is much we can learn from engaging with one another,” he said.
Among the nations in the Middle East, the United Arab Emirates is Australia’s largest trading partner, with approximately $8.8 billion in goods and services traded between 2015-16 and 350 Australian companies holding a presence there.
Both the Middle East and the neighbouring region of North Africa are set to undergo a fintech boom, according to ASIC, with a number of nations taking steps to establish themselves as global fintech hubs.
Amongst them is Bahrain, a nation off the coast of Saudi Arabia, with the Central Bank of Bahrain recently launching a new program to support a regulatory framework for fintech startups. Earlier this year also saw Bahrain’s Economic Development Board form a partnership with Singapore fintech incubator and “ecosystem builder” Singapore Fintech Consortium to help expand its fintech opportunities.
Richard Teng, CEO of ADGM FSRA, said the agreement would offer a clear pathway for both Australian and UAE fintech startups to operate in each other’s countries, a “common interest” for both organisations.
“In the Middle East and North Africa, the opportunities and potential for fintech to advance financial inclusion, economic benefits and growth are enormous,” he said.
“With this fintech collaboration, ADGM and ASIC are able to tap on the strengths and network of each other’s markets to support technology startups and innovators in advancing their creative solutions into new markets. I look forward to our partnership with ASIC and other global authorities to advocate robust financial integration and regulatory collaboration.”
The agreement marks the latest international deal ASIC has formed to help Australian fintech startups navigate international regulations, including with Japan, Malaysia, Singapore, the Canadian province of Ontario, and the UK. The last agreement was formed last month with Hong Kong’s Securities and Futures Commission to help fintech companies in each expand more easily into the other.
ASIC also launched a ‘regulatory sandbox’ late last year to help eligible fintech businesses test their financial or credit services with up to 100 retail clients and unlimited wholesale clients for up to 12 months, without the costs of regulatory licensing.
Image: Greg Medcraft. Source: ABC.