Australian govt proposes amendments to Payment Systems (Regulation) Act
The Australian government is updating the Payment Systems (Regulation) Act 1998 to ensure regulators and government can address new risks related to payments as the provision of payments evolves and increases in complexity.
The updates include:
- Expanding the definitions of “payment system” and “participant” to ensure the Reserve Bank of Australia has the ability to regulate new and emerging payment systems, such as digital wallet providers and Buy Now Pay Later service providers.
- Introducing a new ministerial designation power that will allow particular payment services or platforms that present risks of national significance to be subject to additional oversight by appropriate regulators.
Under the proposals, the definition of ‘payment system’ covers a broader set of arrangements, including payment systems that use non-monetary digital assets for payments or provide services that facilitate a payment being made, and ‘three party’ or ‘closed loop’ systems. The definition of ‘participant’ captures all entities involved in the payments value chain, including entities with or without a direct relationship to a payment system.
The Minister has the power to designate a payment system if the Minister considers that it is in the national interest to do so.
The PSRA contains a civil penalty framework that relies on the standard framework from the Regulatory Powers Act to the extent possible.
The maximum penalties for certain criminal offences in the PSRA are increased to reflect the seriousness of the misconduct.
The government welcomes comments or feedback from stakeholders not later than November 1, 2023.