Australia and Malaysia sign agreement on FinTech cooperation
Following the establishment of a framework for co-operation on FinTech innovation with the Japan Financial Services Agency (JFSA) earlier this week, the Australian Securities and Investments Commission (ASIC) signed a Co-operation Agreement with the Malaysia Securities Commission (SC) on June 27 2017. This agreement expands ASIC's FinTech cooperation network in Asia. Investment in FinTech in the region has been growing exponentially in recent years, with total investment in 2016 reaching $8.6 billion, up from $0.5 billion in 2013.
The agreement will also enable the SC and ASIC to refer innovative FinTech businesses to each other for advice and support via ASIC's Innovation Hub and its Malaysia equivalent, the SC's 'alliance of FINtech community' ('aFINity'). In addition, the agreement provides a framework for information sharing between the two regulators. This will enable ASIC to keep abreast of regulatory and relevant economic or commercial developments in Malaysia and to use this to inform Australia's regulatory approach. The Innovation Hub and aFINity offer assistance to innovative FinTech businesses to understand the regulatory regimes in each of their jurisdictions. This Agreement means Australian FinTech businesses wishing to operate in Malaysia will now have a simple pathway for engaging with the SC, and vice versa.
“International cooperation on FinTech is essential. This agreement will help local businesses grow beyond our borders, and improve our understanding of FinTech in the region. We look forward to working more closely with our colleagues at the Malaysia Securities Commission,” said ASIC Chairman Mr. Greg Medcraft. SC Chairman Mr. Ranjit Ajit Singh said: “Even as we continue to enable new forms of innovation in capital markets, we must not lose sight of the need to manage digital risks, by taking a strategic approach to risk management, recruiting digital talent and improving IT architectures. This collaboration between SC and ASIC in the realm of digital finance will further strengthen the co-operative arrangements between Malaysia and Australia in capital market development and regulation”. This is the sixth FinTech referral agreement ASIC has entered into, following on from agreements with the United Kingdom, Singapore, Ontario, Hong Kong and Japan.
Malaysia and Australia share a long history of cooperation which is reflected in the close relationship of the SC and ASIC. Since 1998, the SC and ASIC have had a Memorandum of Understanding to provide assistance and mutual cooperation in relation to a range of compliance, supervision and enforcement duties. More recently, in 2013 the SC and ASIC jointly hosted a forum on market surveillance. Both regulators are also currently involved in an Asia-Pacific Regional Supervisory College initiative aimed at enhancing our supervisory cooperation and facilitating information sharing in the region.