The Business Council of Australia (BCA) thanks the Committee for the opportunity to make a submission to the Inquiry into Schemes, Digital Wallets and Innovation in the Payments Sector.
The BCA has a diverse membership, covering both providers of payment products and users of these products. We welcome the opportunity to provide a response based on this wide membership.
Payments are essential infrastructure for the operation of the economy. It is important that this infrastructure operates efficiently, effectively and safely, with very high levels of resilience and reliability.
The Committee’s inquiry is occurring at a time of major regulatory change in payments. The recent passage of amendments to the Payment Systems (Regulation) Act 1998 (PSRA) has meant the Reserve Bank of Australia (RBA) now has a much wider regulatory remit. The RBA has announced it will consult on the use of these wider powers later this year. The Government is consulting on reforms to licensing of Payment Service Providers, has announced the closure of the cheques system, has introduced a cash mandate for grocery and fuel retailers, and is implementing the Scams Protection Framework (SPF). This all forms an important backdrop to the Committee’s inquiry, and we encourage the Committee to take account of the significant work already underway.
Our submission provides recommendations on:
- the need for an update to the Strategic Plan for Australia’s Payment System;
- a broader, holistic RBA review of retail payments in the context of the broader payments ecosystem;
- appropriate incentives to improve reliability;
- resilience, the Bulk Entry Clearance System, and planning for ongoing innovation in fast payments;
- appropriate returns to investment, innovation and intellectual property;
- consistency in regulation, and proportionate and risk-based reforms to payment licensing
- best practice regulatory process; and
- the major issue of scams in payments.