Australia and China’s relationship on fintech, regtech and retail

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Australia China
Australia's Prime Minister Malcolm Turnbull shakes hands with Chinese Premier Li Keqiang before the start of an official signing ceremony at Parliament House in Canberra, Australia, March 24, 2017. Reuters/David Gray

Australia and China have agreed to team up on financial technology. The move will see both countries getting oversight on trends in each other's markets.

The Australian Securities and Investment Commission (ASIC) and China Securities Regulatory Commission (CSRC) confirmed on Monday that they would partner and share information about up-and-coming themes in the fintech sector. ASIC chairman Greg Medcraft released a statement on Monday, saying teamwork between regulators is important to realise the benefits of the tech revolution. "Understanding new developments and their impact in overseas markets helps us to remain proactive and forward-looking in our domestic approach,” he said, according to CNBC.

Regulatory technology

Medcraft also said he is looking forward to sharing experiences and insights on regulatory technology with the CSRC. Australia and China’s regulators will provide each other with insights on experiments with regtech, an offshoot of the fintech sector pertaining to innovations that make regulatory compliance and financial regulation more efficient and simpler at the same time. Fintech deals to share information and team up on innovation have been formed by several countries.

The central banks of Hong Kong and Singapore agreed last month to a data sharing deal. They also agreed to a cross-border trade project based on blockchain technology.

Around the world, financial market regulators deal with new challenges posed by market innovations. CSRC and ASIC’s deal will provide an efficient channel for timely exchange of information on fintech developments.

Chinese personal shoppers

In other news, stores catering to personal shoppers are increasing in the Australian retail scene. They are called daigou stores, and they allow Chinese shoppers to send goods to China as demand for Australian products increases.

An AFGC State of the Industry Report shows that hunger for Aussie manufactured brands globally. In 2015-16, for instance, food and beverage exports rose by 11 percent to $26 billion.

Based on an estimate from a public relation agency, there are between 1,200 to 1,600 small daigou stores offering "pack and send" services here, The Conversation reports. These businesses were operated independently.

Daigou stores exist in response to demands of Chinese middle class who like Aussie brands. Seventy percent of China's urban population is tipped to be considered middle class by 2022.

Airwallex Founder Lucy Liu said Daigou businesses are becoming market influencers that can make or break brands in China, ABC News reports. Chinese consultancies now offer to connect Aussie businesses with Chinese bloggers and other social media personalities for the promotion of products and services.