The government is consulting on a licensing framework for payment service providers (PSPs). The proposed reforms will ensure the regulation of payment services is fit-for-purpose and provides consistent regulation based on the activity a payment service provider performs.
This paper is the second on the proposed framework, and follows the first consultation paper released in June 2023 that sought feedback on the proposed list of payment functions to be licensed. The proposed regulatory framework outlined in this paper includes an updated list of payment functions and leverages the Australian Financial Services framework to regulate PSPs.
In addition, the framework proposes:
- a set of regulatory requirements to facilitate greater access to payment systems
- graduated regulatory requirements for stored-value facilities including payment stablecoins
- a framework for industry standard-setting
- a new rule-making power to enable the introduction of a mandatory revised ePayments code to provide enhanced consumer protections.
The government seeks views from interested parties on the proposed framework. Specific consultation questions are outlined within the paper.