Australia's open banking, blockchain and emerging fintech sector received a funding boost in last night's Budget, a move the Treasurer said will increase competition and create new jobs.
Treasurer Scott Morrison said the funding boost will build on its Financial Technology Innovation initiatives first introduced in last year's Budget.
In his Budget speech, Morrison said the Government is "moving forward with our Open Banking Regime and Consumer Data Right, giving small businesses and households more control, more choice and better deals."
The Government will pour $45 million over four years to develop the Consumer Data Right, enabling consumers to share and use their data in a safer way. Data-driven competition and innovation will grow the economy, creating high-value jobs, Morrison said.
It will give consumers greater control of personal data and the choice to direct businesses to share consumers' data safely with trusted recipients, who in turn will be able to offer better deals through innovative products and comparison services, he added.
The banking, energy and telecommunications sectors will be the first to test the Consumer Data Right and it will eventually be rolled out economy-wide.
With respect to how the Government handles and uses the data it collects, Morrison said a National Data Commissioner will oversee the framework and use of data efficiently.
The Government also allocated $29.9 million to develop the nation's artificial intelligence (AI) and machine learning capabilities.
A Technology Roadmap, a Standards Framework and a national AI Ethics Framework will help identify opportunities in these areas and support the responsible development of these technologies, he said.
The initiatives will also support Cooperative Research Centre projects, PhD scholarships and school-related learning to boost the knowledge and skills needed for AI and machine learning.
About $700,000 will be used to fund the Digital Transformation Agency, which aims to investigate areas blockchain technology can add value to Government services.
An additional $100,000 will be used to promote Australia globally as a fintech destination.
In a bid to crack down on the black economy, Morrison is introducing a $10,000 cash payment limit to businesses from 1 July 2019.
Morrison said large, undocumented cash payments used to avoid tax or to launder money from criminal activity can be curbed by requiring transactions of certain amounts to be made via electronic means or cheques.
FinTech Australia chair Stuart Stoyan said this measure has the potential to drive fintech innovation through the increased use of electronic payments technology.
It was disappointing that policies for open banking were left out, although it is understood details will be revealed in the near future, Stoyan said.
Overall, FinTech Australia welcomes the measures in this budget, which continue this government's ongoing support for our industry, he added.
Prospa co-founder and joint chief executive Beau Bertoli said: "We hope the timeline for implementing an open banking system remains ambitious."
While it's great to see the Government's support in the fintech sector, "we had hoped to see some measures that would reduce the relative advantage enjoyed by larger banks."
"Our small business customers will also be pleased to see an extension of the $20,000 instant asset write-off. This popular policy will continue to help small businesses invest in their own growth, creating more jobs and ultimately boosting the Australian economy," Bertoli said.