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The horizon of Regtech

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Customer owned banking institutions have a strong track record of innovation – from introducing the first ATMs in Australia to being live on day one of the new payments platform. With regulatory costs on the rise in recent years, COBA members are now harnessing regulatory technology to explore a new frontier of customer experience and efficiency in compliance.

Australia is also at the forefront of regtech internationally, with around 13 percent of the world’s regtech providers based in Australia.

A recent information report by the Productivity Commission found that the use Regulatory technology – or regtech – can significantly reduce the risks and cost of compliance. The benefits can include cutting down the time to identify and understand regulatory requirements, and speeding up information-gathering processes with customers.

Last year, the mutuals sector spent $192.4 million on technology expenses, an increase of almost 8 per cent from 2018. And in an environment of increasing regulatory compliance costs, COBA members are looking at how technology can help.

Regtech in customer owned banking

The customer owned banking sector is working with a range of regtech partners.

  • Regional Australia Bank is working with Microsoft Azure to develop its API management system for the Consumer Data Right. As an accredited data recipient, Regional Australia Bank collects data from the major banks via APIs upon request of their customers and processes it to use in loan applications.
  • Police Bank has completed the first phase of compliance for the Consumer Data Right, working with SISS Data Services to participate in the open banking regime. The partnership will enable Police Bank to showcase its products alongside other banks and financial institutions through the new digital channel.
  • Heritage Bank partnered with technology company InfoTrack to provide the digital Verification of Identity (VOI) solution, to make lending easier for broker partners. The VOI technology has been particularly helpful during COVID-19, allowing the verification process for new home loans to be completed digitally, without the borrower having to be physically present.


Beyond the sector, ASIC is also exploring the potential of regtech for consumer protection. Possible applications include assessing financial promotional materials in meeting their disclosure obligations, as well as gauging the compliance of financial advice using AI and natural language processing.

Looking ahead, customer owned banking will continue to explore the role of technology in this emerging landscape with one group of beneficiaries squarely in mind – customers.

Story by This e-mail address is being protected from spambots. You need JavaScript enabled to view it , Senior Policy Advisor, COBA

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