Australian regulator signs fintech agreement with Kenya

Added 24th October 2016

The Australian Securities and Investments Commission (ASIC) has signed a cooperation agreement with the Capital Markets Authority of Kenya (CMA) in a bid to boost financial services technology for both countries.

Australian regulator signs fintech agreement with Kenya

The agreement, signed in Hong Kong during a board meeting of the International Organization of Securities Commissions (IOSCO), establishes a framework for both parties that allows the sharing of information on their respective markets such as emerging trends as well as regulatory issues.

According to both parties, the partnership has been established as a result of the growing need to compare regulatory road blocks with other regions, with ASIC noting that innovation in the fintech space is not confined by national borders.

"The CMA has recently commenced efforts towards the establishment of a regulatory sandbox structure that is designed to encourage innovation in the capital markets. This strategy reflects the CMA's role in facilitating the introductions of new fintech products in the capital markets area," Paul Muthaura, chief executive of the CMA, said in a statement.

"ASIC has developed an innovation hub and we are keen to share best practices in terms of how to address regulatory issues pertaining to innovation in financial services."

The move mirrors a similar measure by the UK’s FCA, which launched its regulatory sandbox earlier this year.

Meanwhile, ASIC unveiled its innovation hub in 2015, which it said has since received many requests from fintech startups for assistance with regulatory issues.

Kenya reforms

Kenya is currently going through widespread financial services reforms which will merge four regulators, including the CMA, into one overarching watchdog, to be known as the Financial Service Authority (FSA).

The other bodies include Retirement Benefits Authority (RBA), the Insurance Regulatory Authority (IRA), and the Sacco Societies Regulatory Authority (Sasra).

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