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20 January 2021
2020 was the year of the rat. Apparently, according to the Chinese Zodiac, it was a year to turn unlucky events into fortune. We've just entered the year of the ox, when apparently, it will be a year to use hard work and relationships to correct and rebuild.
As we enter a new year, we continue to face economic and social uncertainties, but there is so much to acknowledge about how Australia has responded in this global pandemic, and consequently, the position we find ourselves. As the Deloitte Access Economics Business Outlook recognises, Australia is one of only five countries that enter 2021 so well-placed, with COVID-19 numbers very low, vaccine news excellent, confidence levels rebounding, and recovery underway.
The role we all play in helping our customers and communities through this next phase, and to rebuild, may be even more important than our initial response to the crisis. This is an opportunity for AFIA to continue to push a ‘whole of financial system’ approach to our economic recovery, emphasising our principles to support access and choice, competition and innovation, and participation.
The Treasurer, the Hon Josh Frydenberg MP, notes our economy is now in a more stable position due to the support provided through the JobKeeper Program and the impact of other economic measures. In recent interviews, the Treasurer has restated that the JobKeeper Program was intended to be temporary and that the best next steps in our recovery will be achieved by controlling the virus and ensuring that Australians can safely move around and stimulate the economy.
AFIA will continue to ensure our members’ views are well-understood by key decision makers, by further advancing our strategic work program across leadership, advocacy, and engagement, and by leveraging our work in policy, industry standards, and data.
We’re currently preparing our pre-budget submission. With most of our proposals adopted by the Federal Government last year, they are keen to hear from AFIA on how to leverage these measures to maximise impact this year and going forward. We're focused on making sure we continue to inject solid thinking into economic policymaking and use data and experience to influence these settings.
We’re also finalising our submission to the Federal Government’s review of the regulatory architecture for Australia’s payments system. The review is focused on future proofing payments system regulations. There is still time to incorporate members’ views in our submission, so please reach out to the policy team if you wish to contribute.
In parallel, the RBA is reviewing the existing payments system regulations. The RBA Governor, Philip Lowe, has reaffirmed the RBA’s philosophy of ‘only regulating when it is clear that doing so is in the public interest’ and ‘the Board is unlikely to conclude that BNPL operators should be required to remove their no-surcharge rules right now’ (see Governor’s speech). We had informal discussions with the RBA late last year and now we’re awaiting the release of their consultation paper before bringing members together to prepare our formal submission. Watch this space.
Cognisant of the timetable and issues related to the proposed changes to credit laws, we’re talking with key stakeholders ahead of the resumption of Parliament to stress the importance of scalable, proportionate, and regulator-agnostic laws. This is important to support our economic recovery and streamline access to credit, by simplifying processes, minimising documentation, and reducing hassle for all.
AFIA is also prioritising our work in industry standards. Our BNPL Code of Practice will commence on 1 March 2021. We’re now in the process of establishing the Code Compliance Committee and accrediting members as well as ensuring key stakeholders understand the Code and our commitments. Consultation on our Insurance Premium Funding Code of Practice has been extended to provide stakeholders more time to give their feedback. For more information about our draft IPF Code, please go to the AFIA website for the draft, key facts, and media release.
AFIA is also continuing to embed our new industry data project. We have been working closely with our data partner and members on building the system. There is more to complete with members, including on-boarding, getting the definitions, categories, and other facts right, and preparing report templates – which are a real improvement. Again, watch this space.
No rest for the wicked... well, a little bit of rest! I don’t know about you, but rest and relaxation has been an essential part of the Christmas and new year celebrations. Like most of 2020, the way we spent this holiday period was disrupted. Given we learned so much about adaptability and resilience in 2020, as well as productivity in the face of uncertainty, I’m hoping you all translated this into enjoying a COVIDnormal holiday break.
I’m energised and optimistic about 2021 – I’ve had a couple of weeks sleep, finished watching The Queen’s Gambit – some great metaphors about understanding your environment and keeping ahead of the game – and spent quality time with family and friends, even if virtually! And my team and I are very much looking forward to working with you all in maintaining the momentum of our recovery, embedding the vital role our industry plays in our recovery, and our nation more generally, and being part of building a more resilient, inclusive, and sustainable community.
Categories: CEO Updates