The Corporations (FinTech Sandbox Australian Financial Services Licence Exemption) Regulations 2020 and National Consumer Credit Protection (FinTech Sandbox Australian Credit Licence Exemption) Regulations 2020 will commence on 1 September 2020. Background.
The exemption lasts for a period of no more than 24 months to allow for each type of credit activity and each financial service provided in relation to each type of financial product, being tested by an eligible person.
Types of financial services that can be provided
The eligible financial services that can be tested under the exemption include:
• providing financial product advice in relation to a particular kind of eligible financial product;
• applying for or acquiring a particular kind of eligible financial product;
• issuing, varying or disposing of a non-cash payment facility;
• arranging for the issuing, varying or disposing of a particular kind of eligible
• providing a crowd-funding service.
Types of credit activities that can be provided under the exemption
The eligible credit activities that can be tested under the exemption include the provision of credit contracts and credit services which relate to a credit contract (or proposed credit contract) with:
• a term that does not exceed four years; and
• a credit limit of more than $2,000 and less than $25,000.
However, a credit activity is not eligible if the relevant contract is:
• a reverse mortgage, or a small amount credit contract; or
• secured by a charge or lien over a consumer’s household property covered by subregulation 6.03(2) of the Bankruptcy Regulations 1996.
In order to access the exemption, a person must first notify ASIC that they intend to start relying on the exemption to provide an eligible activity. The notification must be lodged with ASIC in the form approved by ASIC.
ASIC has 30 days to respond to the notification. If ASIC does not respond within the 30 days then the exemption is taken to start the day after the 30 day notification period ends.
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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.
