Enhanced regulatory sandbox (ERS)

On 1 September 2020, the Government introduced the enhanced regulatory sandbox (ERS) to facilitate financial innovation in Australia. The ERS allows natural persons and businesses to test certain innovative financial services or credit activities without first obtaining an Australian financial services (AFS) licence or Australian credit licence (credit licence).

The ERS supersedes the previous regulatory sandbox administered by ASIC. It allows testing of a broader range of financial services and credit activities for a longer duration (up to 24 months).

Sandbox guidance

Information Sheet 248 Enhanced Regulatory Sandbox (INFO 248) provides detailed guidance on the eligibility criteria and features of the sandbox, including the types of financial services and credit activities that are permitted, and any specific conditions that must be met.

The following Infographic provides a snapshot of key information related to the sandbox in an accessible format. It is, however, recommended that prospective users refer to INFO 248 for detailed information and guidance.

The following resources provides further information on the updated framework:

Meeting your sandbox conduct and disclosure obligations

When you provide eligible financial services or engage in eligible credit activities under the ERS exemption, you are required to comply with specified conduct and disclosure obligations as a condition of your exemption. These obligations apply to you as if you were an Australian financial services (AFS) licensee or an Australian credit licensee.

Below is a list of AFS and credit regulatory guides that provide further guidance on how you can comply with your obligations:

Applying for the sandbox

Businesses that are interested in applying for the sandbox are encouraged to refer to INFO 248 for detailed information on eligibility requirements and conditions, sandbox regulations, how to apply and other general guidance.

Before lodging an application to use the sandbox, businesses are urged to first contact ASIC's Innovation Hub for informal assistance and guidance at innovationhub@asic.gov.au.

Sandbox applications must be emailed directly to ersnotifications@asic.gov.au (not to the Innovation Hub).

Sandbox exemption users

Current users

Finkey Financial Holdings Pty Ltd

ABN: 60 666 075 207

Authorisations/Services Approved:

  • Provide credit contracts with a term that does not exceed 4 years and a credit limit of more than $2,000 and less than $25,000.

Clients: Retail

Business Description: Finkey Financial Holdings Pty Ltd proposes to provide low interest ‘green’ loans to consumers financing home efficiency upgrades and renovation projects that incorporate sustainable materials and practices. Data obtained from third parties and credit bureaus will be used to make credit decisions. In the mid-to-late term, they aim to use AI to revolutionise the loan origination process to enhance risk assessment, refine credit evaluations, and optimise lending decisions. Blockchain technology will be used to register building materials etc and maintain a record of transactions. They plan to use the Clean Energy Council’s ‘Best Practice Guidelines’ to determine what qualifies as a green project. They have developed a Target Market Determination and a Design and Distribution Policy and Compliance process.

Date ERS exemption commences: 8 September 2023

Date ERS exemption ceases: 7 September 2025

AFCA membership number: TBA

AtPay Trading Pty Ltd

ABN: 18 659 147 547

Authorisations/Services Approved:

  • Deal in a financial product by:
    • issuing, varying or disposing of a non-cash payment facility

Clients: Retail

Business Description: AtPay Trading Pty Ltd is a BNPL and payment gateway provider that leverages blockchain technology to facilitate crypto and fiat purchases. Users can pay for products with either crypto or fiat currencies and participating merchants can select their preferred settlement currency. Users will have the option of participating in BNPL or paying the full amount upfront. AtPay Trading Pty Ltd intends to test crypto-payment/fiat-settlement and fiat-payment/crypto-settlement transactions with a non-cash payment facility exemption.

Date ERS exemption commences: 29 January 2023

Date ERS exemption ceases: 28 January 2025

AFCA membership number: 95084

Odos Group Pty Ltd

ABN: 70 646 325 448

Authorisations/Services Approved:

  • Provide general financial product advice for the following classes of financial products:
    • a deposit-taking facility made available by an ADI in the course of its banking business, other than a Retirement Savings Account (RSA)
    • a non-cash payment facility made available by an ADI in the course of its banking business
  • Deal in a financial product by:
    • issuing, varying or disposing of a non-cash payment facility
    • applying for or acquiring a financial product in respect of the following classes of products:
      • a deposit-taking facility made available by an ADI in the course of its banking business, other than a Retirement Savings Account (RSA)
      • a non-cash payment facility made available by an ADI in the course of its banking business
    • arranging for the issuing, varying or disposing of a financial product in respect of the following classes of products:
      • a deposit-taking facility made available by an ADI in the course of its banking business, other than a Retirement Savings Account (RSA)
      • a non-cash payment facility made available by an ADI in the course of its banking business

Clients: Retail and wholesale

Business Description: Odos Pty Ltd intends to operate a payments service associated with a reward/loyalty program focussed on sports, cultural and entertainment industries. The reward/loyalty program will be offered in the form of ODOS tokens which will serve as a medium to redeem coupons (presented as NFTs via Odos’ proprietary technology) from participating merchants. Both the tokens and NFTs will be issued on the Polygon blockchain network.

Date ERS exemption commences: 3 August 2023

Date ERS exemption ceases: 2 August 2025

AFCA membership number: 98992

Kuber Financial Pty Ltd

ABN: 90 652 317 907

Authorisations/Services Approved:

  • Dealing by issuing, varying or disposing of a non-cash payment facility;

Clients: Retail and wholesale

Business Description: Kuber Financial Pty Ltd proposes to provide a peer-to-peer and merchant payment system securely and in real time using blockchain technology. The ‘Kuber’ app will allow users to keep track of their financial affairs in a simple and smart way by providing additional features such as periodic analytics, social media connectivity and group finance management apart from peer-to-peer and merchant transfers. The technology stack of Kuber Financial is in line with ISO27001 cyber security standards and they have also applied to the ACCC to become a CDR Accredited Data Recipient.

Date ERS exemption commences: 30 April 2022

Date ERS exemption ceases: 29 April 2024

AFCA membership number: 86775

Waave Technologies Pty Ltd

ABN: 60 642 784 030

Authorisations/Services Approved:

  • Providing General Advice in relation to the following financial product:
    • a non-cash payment facility made available by an ADI in the course of its banking business;
    • Dealing by issuing, varying or disposing of a non-cash payment facility;

Clients: Retail and wholesale

Business Description: Waave Technologies Pty Ltd plans to offer a digital wallet (the Waave app) to make one-off or recurring payments to merchants / utilities. Funds for payments will be sourced from the customer’s existing bank accounts (verified through Open Banking) and real-time payments will be made using the New Payments Platform (NPP).

Date ERS exemption commences: 23 December 2021

Date ERS exemption ceases: 23 December 2023

AFCA membership number: 86444

Past users

Carbon Investment Group Pty Ltd

ABN: 55 634 223 911

Authorisations/Services Approved:

  • Providing General Advice in relation to the following financial product:
    • a security included in an official list of a prescribed Australian financial market;

Clients: Retail only

Business Description: Carbon Investment Group Pty Ltd proposes to provide a subscription-based stock picking service to its clients through its website. The stocks are Australian-listed securities which will be selected based on advanced algorithms that use Artificial Intelligence (AI).

Date ERS exemption commenced: 29 September 2021

Date ERS exemption ceased: 28 September 2023

AFCA membership number: 82079

Linea Operations Pty Ltd (trading as Acacia Money)

ABN: 78 639 332 317

Authorisations/Services Approved:

  • Providing General Advice and Dealing by arranging for the issuing, varying or disposing of a financial product in relation to the following financial products:
    • a deposit-taking facility made available by an ADI in the course of its banking business, other than a Retirement Savings account (RSA);
    • a superannuation product in a regulated superannuation fund issued by an APRA-regulated RSE licensee; and
    • a security included in an official list of a prescribed Australian financial market;

Clients: Retail only

Business Description: Linea Operations Pty Ltd proposes to offer an app that will provide clients with a holistic view of their finances, enable product comparisons and provide access to investing in Australian shares through third-party broker arrangements.

Date ERS exemption commenced: 11 July 2021

Date ERS exemption ceased: 10 July 2023

AFCA membership number: 83297

InvestorFX Pty Ltd

ABN: 95 606 593 499

Authorisations/Services Approved:

Provide General Advice and Deal by Applying for or Acquiring the following classes of financial products – to wholesale clients only:

  • a non-cash payment facility made available by an ADI in the course of its banking business;
  • an interest in a simple managed investment scheme;
  • a debenture, stock or bond issued or proposed to be issued by the Commonwealth;
  • a security included in an official list of a prescribed Australian financial market;
  • a security included in an official list of a prescribed overseas financial market: New York Stock Exchange, NASDAQ, LSE, DAX and Euronext;
  • foreign exchange contracts;
  • basic and non-basic deposit products;
  • interests in managed investment schemes including IDPS; and
  • interests in managed investment schemes limited to MDA services

Deal by issuing, varying or disposing of a non-cash payment facility – to wholesale clients only.

Clients: Wholesale

Business Description: InvestorFX Pty. Ltd. proposes to provide, through its ‘IFX App’, a single hub for personal investment, saving, payments, budgeting / analytics, digital wallet, currency transfers and borrowing.

Date ERS exemption commenced: 28 March 2021

Date ERS exemption ceased: 27 March 2023

AFCA membership number: 80942

Halalstocks.co Pty Ltd

ABN: 77 639 348 593

Authorisations/Services Approved: General advice in securities included in an official list of a prescribed overseas financial market (NYSE and NASDAQ in the United States).

Clients: Retail

Business Description: Halalstocks.co Pty Ltd offers clients a menu of ethical and Shariah-compliant equity investment options (‘models’) on their website and app, and customers can select a model based on their preference.

Date ERS exemption commenced: 5 January 2021

Date ERS exemption ceased: 4 January 2023

AFCA membership number: 79890

Bano Pty Ltd

ABN: 93 643 260 431

Authorisations/Services Approved:

  • Providing general financial product advice for the following classes of financial products:
    • a deposit taking facility made available by an ADI in the course of its banking business, other than an RSA;
    • a non-cash payment facility made available by an ADI in the course of its banking business;
    • a debenture, stock or bond issued or proposed to be issued by the Commonwealth;
    • a security included in an official list of a prescribed Australian financial market;
    • a security included in an official list of a prescribed overseas financial market: Euronext, Frankfurt Stock Exchange, Hong Kong Stock Exchange, JSE (Johannesburg Stock Exchange), London Stock Exchange, NASDAQ Global Market, New York Stock Exchange, NZX (New Zealand Stock Exchange), Singapore Exchange, SIX Swiss Exchange, Tokyo Stock Exchange, Toronto Stock Exchange;
    • an interest in a simple managed investment scheme;
  • Dealing by applying for or acquiring / Dealing by arranging for the issuing, varying or disposing of the following financial products:
    • a deposit taking facility made available by an ADI in the course of its banking business, other than an RSA;
      a non-cash payment facility made available by an ADI in the course of its banking business;
    • a debenture, stock or bond issued or proposed to be issued by the Commonwealth;
    • a security included in an official list of a prescribed Australian financial market;
    • a security included in an official list of a prescribed overseas financial market: Euronext, Frankfurt Stock Exchange, Hong Kong Stock Exchange, Johannesburg Stock Exchange, London Stock Exchange, NASDAQ Global Market, New York Stock Exchange, New Zealand Stock Exchange, Singapore Exchange, SIX Swiss Exchange, Tokyo Stock Exchange, Toronto Stock Exchange;
    • an interest in a simple managed investment scheme; and
  • Dealing by issuing, varying or disposing of a non-cash payment facility

Clients: Retail and wholesale

Business Description: Bano Pty Ltd offers a digital wallet that, in addition to payment services, also offers users options to avail of remittance services and to invest in simple managed investment schemes, domestic/international securities, and Commonwealth debentures/stocks/bonds.

Date ERS exemption commenced: 19 December 2020

Date ERS exemption ceased: 19 December 2022

AFCA membership number: 78414

Fee Stream Pty Ltd

ABN: 64 635 453 164

Authorisations/Services Approved: Dealing by issuing, varying or disposing of a non-cash payment facility.

Clients: Retail

Business Description: Fee Stream Pty Ltd operates a payments bridge business model using SaaS technology combined with behavioural analytics to produce better cashflow outcomes for both customers and merchants. It helps customers set up their own payment plan and make flexible payment towards bills, such as council rates.

Date ERS exemption commenced: 1 October 2020

Date ERS exemption ceased: 30 September 2022

AFCA membership number: 77369

Xen Pay Pty Ltd

ABN: 28 642 659 658

Authorisations/Services Approved: Dealing by issuing, varying or disposing of a non-cash payment facility.

Clients: Retail

Business Description: Xen Pay Pty Ltd proposes to provide a zero touch payments service between clients via a mobile app by one of two methods – either by scanning an assigned QR Code or nominating the mobile phone number registered to a payee (consumer or merchant).

Date ERS exemption commenced: 19 February 2021

Date ERS exemption was scheduled to cease based on ASIC approval: 18 February 2023

Date ERS exemption ceased based on notice from the entity to ASIC: 3 March 2022

AFCA membership number: 78306

Westgate Finance Pty Limited

ABN: 30 072 165 603

Authorisations/Services Approved:

Financial services:

  • Providing personal financial product advice in a non-cash payment facility made available by an ADI in the course of its banking business, other than an RSA;
  • Dealing by applying for or acquiring a non-cash payment facility made available by an ADI in the course of its banking business;
  • Dealing by issuing, varying or disposing of a non-cash payment facility; and
  • Arranging for the issuing, varying or disposing of a non-cash payment facility made available by an ADI in the course of its banking business.

Clients: Retail

Credit activities:

  • Provide credit contracts with a term that does not exceed 4 years and a credit limit of more than $2,000 and less than $25,000.
  • Provide credit services in relation to credit contracts with a term that does not exceed 4 years and a credit limit of more than $2,000 and less than $25,000.

Business Description: Payments platform that offers credit to strata owners and makes quarterly strata payments on their behalf to strata managers under previously established distribution arrangements.

Date ERS exemption commenced: 17 May 2021

Date ERS exemption was scheduled to cease based on ASIC approval: 16 May 2023

Date ERS exemption ceased based on notice from the entity to ASIC: 28 May 2021

AFCA membership number: 81963

Sorgenfrey Pty Ltd

ABN: 48 646 362 183

Date ERS exemption ceased based on notice from the entity to ASIC: 30 November 2021

Edufund Pty Ltd

ABN: 13 647 371 739

Date ERS exemption ceased based on notice from the entity to ASIC: 1 March 2022

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Last updated: 08/12/2023 02:07