21 October 2020

Driving innovation in the payments system

The Morrison Government will review the regulatory architecture of the Australian payments system as part of the Digital Business Package announced in the 2020-21 Budget to ensure it remains fit for purpose and is capable of supporting continued innovation for the benefit of both businesses and consumers.

The Government is investing almost $800 million to enable businesses take advantage of digital technologies to grow their businesses and create jobs as part of our economic recovery plan.

The regulatory architecture of the payments system has served Australia well, but has remained largely unchanged for over two decades. This comes at a time when consumer appetite for using different payment methods, like contactless payments, has accelerated.

It is critical that the regulatory architecture supporting our payments system promotes innovation and competition to ensure that costs to business are minimised, consumer experience is enhanced and there is confidence in the security of the system.

The review will look at whether the regulatory architecture of the payments system is fit for purpose given rapid changes in technology, how to drive increased productivity through innovation and competition, assess government payment systems and analyse global trends to determine how Australia can remain internationally competitive. 

The review will be led by Mr Scott Farrell, who undertook the formative review which gave rise to the Consumer Data Right regime.

The review will draw upon expertise from the private sector by consulting broadly with industry, consumer and privacy advocates, and other interested parties in developing the report and recommendations.

Promoting a more innovative and robust payments environment is part of the Morrison Government’s plan to build a more competitive and productive economy as we recover from the COVID-19 crisis.

The review will report to Government by April 2021.

The terms of reference are available on Treasury’s website.