1 Comment 1 Commentby Susan Edmunds
Chapman Tripp warned earlier this week that although New Zealand pulled ahead of the pack in fintech through the Financial Markets Conduct Act’s 2013 provisions for equity crowdfunding and peer-to-peer lending, it was now in danger of falling behind again. It called for action from Government, FMA and the industry to ensure innovation continued.
“Australia is initiating a range of measures to promote itself as a financial technology or ‘FinTech’ hub, as are Hong Kong, Singapore and the United Kingdom. If we lose pace now, it will be very difficult to catch up,” the law firm said.
Jeremy Muir, a specialist financial services lawyer at Minter Ellison Rudd Watts, said New Zealand had an advantage over many other countries in that its financial services regulation was at a relatively lower level, and was flexible. The country was good at innovation and had a strong tech base, he said.
Fintech start-ups such as equity crowdfunding platforms had been able to innovate, he said, because the model was flexible enough that they could built what suited them, and then apply for a licence for it. “It’s not prescriptive in terms of what it should look like.”
He said the framework suggested for roboadvice in the Financial Advisers Act seemed to be set to follow the same pattern.
“You build something that works for you, the idea is not to be prescriptive, as long as it meets certain standards. This should be a great country to develop roboadvice models in. We have clients looking at developing things because of the other advantages we have,” he said. “We could be a leader in roboadvice if we do it right.”
But he said there was a risk that New Zealand could be left behind because other countries’ governments had already been pouring substantial resources into developing their fintech sectors.
That had helped Australia outperform, he said, even though their regulation was tougher to contend with.
Jeff Stangl, of Massey University and the CFA Society, said the FMA and MBIE were trying to keep up with the pace of change in fintech. “But it’s evolving very quickly.”
It was announced yesterday that Kiwibank, Xero, Callaghan Innovation and Creative HQ will launch a Kiwibank Fintech Accelerator. Based in Wellington, it will initially fund and support eight Kiwi fintech start-ups to build, launch and expand products in global markets
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Long row to hoe, I think, although I hope I'm wrong.