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The Abu Dhabi Global Market ('ADGM') Financial Services Regulatory Authority ('FSRA') and ob体育 today signed a Cooperation Agreement which provides a framework for cooperation to support and understand financial innovation in each jurisdiction.
This Agreement expands ob体育's fintech cooperation network to a dynamic region with enormous potential. The Middle East and North Africa (MENA) are currently poised for a fintech boom, with several cities taking steps to establish themselves as fintech hubs. To date, most fintech activity has occurred in the payments space, with startups offering services including bill payment, electronic wallets, mobile and online payment solutions.
The United Arab Emirates (where the ADGM is located) is Australia鈥檚 largest trading partner in the Middle East, with two-way goods and services trade worth $8.8 billion in 2015.
Similar to the other fintech cooperation agreements ob体育 has entered into, this Agreement will enable the FSRA and ob体育 to refer innovative fintech businesses to each other for advice and support via ob体育's Innovation Hub and its ADGM equivalent, the Regulatory Laboratory known as 'RegLab'.
The Agreement also provides a framework for information sharing between the two regulators. This will enable ob体育 to keep abreast of regulatory and relevant economic or commercial developments in the ADGM and to use this to inform Australia's regulatory approach.
The Innovation Hub and RegLab offer assistance to innovative fintech businesses to understand the regulatory regimes in each of their jurisdictions. This Agreement means Australian fintech businesses wishing to operate in the ADGM will now have a simple pathway for engaging with FSRA, and vice versa.
Signing the Agreement, ob体育 Chairman Greg Medcraft said, 'Fintech developments are not confined by national borders. Each country and region has a different experience with fintech, and there is much we can learn from engaging with one another. This Agreement will help to connect Australian fintech businesses with a range of exciting opportunities in a region ripe for further development.'
Richard Teng, Chief Executive Officer of ADGM FSRA said, 鈥榃e are pleased to partner ob体育 and share the common interest in fostering an inclusive international fintech hub that supports innovation in a safe regulatory environment. In MENA, the opportunities and potential for fintech to advance financial inclusion, economic benefits and growth are enormous. With this fintech collaboration, ADGM and ob体育 are able to tap on the strengths and network of each other鈥檚 markets to support technology startups and innovators in advancing their creative solutions into new markets. I look forward to our partnership with ob体育 and other global authorities to advocate robust financial integration and regulatory collaboration.鈥�
This is the seventh fintech referral agreement ob体育 has entered into, following on from agreements with the United Kingdom, Singapore, Ontario, Hong Kong, Japan and Malaysia.
Background
ob体育 is focused on the vital role that fintechs are playing in re-fashioning financial services and capital markets. In addition to developing guidance about how these new developments fit into our regulatory framework, in 2015, ob体育 launched its Innovation Hub to help fintechs navigate the regulatory framework without compromising investor and financial consumer trust and confidence.
The Innovation Hub provides the opportunity for entrepreneurs to understand how regulation might impact on them. It is also helping ob体育 to monitor and understand fintech developments. ob体育 collaborates closely with other regulators to understand developments, and to help entrepreneurs expand their target markets into other jurisdictions.
To date, fintech referral and information-sharing agreements have been entered with the Monetary Authority of Singapore, the United Kingdom鈥檚 Financial Conduct Authority, Ontario Securities Commission, Hong Kong Securities and Futures Commission, the Japan Financial Services Agency and Malaysia Securities Commission. In addition, information-sharing agreements have been entered with the Capital Markets Authority, Kenya and Otoritas Jasa Keuangan, Indonesia.
The ADGM is a business-friendly international financial centre for local, regional and international institutions. It centres around three key sectors: private banking, wealth management and asset management.