Treasurer Josh Frydenberg said he would "carefully
consider" that and other recommendations from a government-commissioned
report into whether the payments system had kept pace with advances in
technology and changes in consumer demand.
Services such as Apple Pay, Google Pay, and China's WeChat
Pay, which have grown rapidly in recent years, are not currently designated as
payment systems, putting them outside the regulatory system.
"Ultimately, if we do nothing to reform the current
framework, it will be Silicon Valley alone that determines the future of our
payments system, a critical piece of our economic infrastructure,"
Frydenberg said in an opinion piece published in the Australian Financial
Review newspaper.
The Bank for International Settlements (BIS) earlier this
month called for global financial watchdogs to urgently get to grips with the
growing influence of 'Big Tech', and the huge amounts of data controlled by
groups such as Google, Facebook, Amazon, and Alibaba.
The Australian report recommended the government be given
the power to designate tech companies as payment providers, clarifying the
regulatory status of digital wallets.
It also recommended the government and industry together
establish a strategic plan for the wider payments ecosystem and that a single,
integrated licensing framework for payment systems be developed.
The Reserve Bank of Australia (RBA), which is currently in
charge of designating who is a payment services provider, reported that
payments through digital wallets had grown to 8 percent of in-person card transactions
in 2019, up from 2 percent in 2016.
The Commonwealth Bank of Australia, which has estimated
digital wallet transactions more than doubled in the year to March to AUD 2.1
billion has urged regulators to address "competition issues" and
consider the safety implications of their use.
© Reuters