ASIC Backs Australia’s Fintech Future As AI Transforms Financial Services
Synopsis
ASIC says Australia’s fintech sector is entering a strong growth phase, with AI adoption accelerating across financial services and startup investment rebounding sharply.
The Australian Securities and Investments Commission says Australia is well placed to benefit from the next wave of fintech and regtech innovation as artificial intelligence becomes increasingly embedded across financial services. The regulator released new research examining how digital finance is evolving globally, with findings showing AI is now playing a growing role in areas such as lending, insurance claims, portfolio management and regulatory compliance.
Key highlights
- ASIC says Australia is well positioned for fintech and regtech growth
- AI is rapidly entering mainstream financial operations
- Australian startups raised more than $5 billion in 2025
- ASIC plans deeper industry engagement on digital finance regulation
- The regulator says innovation must remain safe and consumer-focused
AI Becoming Central To Financial Services
The research, conducted by the Digital Finance Cooperative Research Centre found AI is steadily shifting from experimental use cases into everyday financial operations.
ASIC said the findings will help shape future discussions with industry through its Digital Finance Advisory Panel and upcoming consultation roundtables as regulators respond to rapid technological change across the finance sector.
ASIC Chair Joe Longo said Australia has a strong history of turning innovation into commercial success, including within financial services.
He pointed to Australia’s payments infrastructure and early leadership in buy now, pay later services as examples of the country’s innovation strength.
Startup Funding Recovery Adds Momentum
ASIC also highlighted improving conditions for Australia’s startup ecosystem.
According to the regulator, Australian startups raised more than $5 billion in venture capital during 2025, making it the third-strongest funding year on record and nearly 50% higher than levels seen in 2018.
The report also cited data showing Australia has produced more unicorn companies relative to venture capital invested than any other country since 2000.
ASIC Pushes ‘Responsible Innovation’
While backing innovation, ASIC stressed that regulation must evolve alongside new technology.
Longo said innovation can improve productivity, strengthen economic growth and deliver better customer experiences, but added that consumer protection and market integrity must remain central.
ASIC said it will continue pursuing simpler, principles-based regulation through its regulatory simplification initiative to reduce unnecessary friction for businesses while maintaining oversight standards.
Innovation Hub To Remain Central
ASIC’s ASIC Innovation Hub will continue supporting fintech and regtech firms seeking guidance on licensing and regulatory obligations.
The regulator also operates the Enhanced Regulatory Sandbox, which allows eligible firms to test certain products and business models under limited licensing exemptions.
ASIC reviewed the Innovation Hub earlier this year and plans to relaunch it with a stronger focus on supporting financial market innovation.
Digital Finance Becoming Bigger Policy Focus
The report comes as Australia increases its focus on digital finance infrastructure and tokenised markets.
ASIC is also involved in Project Acacia, alongside the Reserve Bank of Australia, and the Digital Finance Cooperative Research Centre to examine the role of digital money in wholesale tokenised asset markets.
ASIC said Australia starts from a position of strength, but maintaining that advantage will depend on how industry and regulators manage the next phase of technological change.
FAQs
Q1: What did ASIC say about fintech growth?
ASIC said Australia is strongly positioned for future fintech and regtech expansion due to improving startup funding and growing AI adoption.
Q2: How is AI being used in finance?
AI is increasingly being used in lending, claims processing, investment management and compliance functions.
Q3: What is ASIC’s Innovation Hub?
It is a support initiative that helps fintech and regtech firms navigate Australian licensing and regulatory requirements.
Q4: What is Project Acacia?
Project Acacia is a joint digital finance initiative examining digital money and tokenised asset markets in Australia.
Q5: Why is Australia considered strong in fintech?
ASIC says Australia benefits from strong payments infrastructure, active startup investment and a supportive innovation ecosystem.
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I write about markets, money, and the macro forces that move them. Passionate about turning complex economic trends into sharp, easy-to-understand stories. Off the clock, it’s hip hop, rock, reggae -- and a mix of cricket and basketball.
