Patrick is an accounting & economics graduate, a Cryptocurrency enthusiast, and a Blockchain technology fanatic. When not crafting informative pieces on any of the above subjects, he will be researching on how the Blockchain technology can transform the world, particularly the financial space.
The Reserve Bank of Australia revealed that payments made via digital wallets for in-person transactions grew to 8% in 2019, a 6% gain since 2016.
The government in Australia is seeking to introduce new, tighter laws that are meant to govern and regulate giant digital service providers like Google, Alphabet and Apple. Frydenberg, a government treasurer, was quoted saying that they will use a government-commissioned report to decide whether payment systems in the country have advanced to match the current technological advancement and demands of the consumer. Digital service providers like China’s WeChat Pay, Google Pay, and Apple Pay however are currently not considered as payment systems thus, not under the regulatory system of the country.
The governmental treasurer was further quoted saying that if action is not urgently taken to regulate the current framework, then it would mean that the future of digital payments will remain in the hands of Silicon Valley, which is critical for the country’s economic infrastructure.
At the start of the month, The Bank of International Settlements (BIS) advised global financial watchdogs to consider and try to regulate the influence wielded by the big tech companies, not forgetting the large amounts of data at their disposal. Companies such as Amazon, Google, Facebook, Alibaba, and other players in their league are particularly known to be having a lot of data at their disposal.
The Australian report recommends the government be allowed to classify these tech companies as payment providers and also clarify the regulation of digital wallets. The report also recommended that the government and industry should collaborate to come up with an efficient strategic plan for the payment. In addition to that, a single integrated licensing system of payment should be adopted.
The Reserve Bank of Australia, currently mandated with deciding who falls under the payment services provider category, revealed that payments made via digital wallets for in-person transactions grew to 8% in 2019, a 6% gain since 2016. Estimates by the Commonwealth Bank of Australia indicate that transactions made through digital wallets increased by two times in the year to March reaching $2.1 billion.
The bank requested regulators to act fast and address issues related to competition, and also consider the safety impacts surrounding the use of digital wallets. Regulating digital wallets by the government goes an extra mile to cushion users against cybercrime and other financial-related crimes. Additionally, personal data held by some of these big tech companies may be used maliciously and expose people to financial crimes.