2. Payments system at a glance - Licensing requirements

Licensing requirements for participants vary depending on their level of involvement in financial services (including in payment systems). The main licenses that a participant may require are set out below.

Authorised Deposit-taking Institution (ADI) licence

Organisations that want to accept deposits from consumers or businesses in Australia will need an ADI licence from APRA.

Obtaining an ADI licence requires a significant investment of time and resources. There are two options available to applicants:

  • Full ADI – suitable if they have the resources and capabilities necessary to meet the full criteria for an ADI. APRA expects established companies to follow this path.
  • Restricted ADI - suitable if they do not currently have the resources and capabilities to meet the full criteria for an ADI and need time to develop them (a maximum of two years is allowed). The restricted ADI is designed to help smaller institutions, fintechs and digital banks enter the payments system. Under the restricted conditions of this licence they are not allowed to provide products or services to the general public.

More information on ADI licensing is available from APRA.

Australian Financial Services Licence (AFSL)

Organisations providing a service that allows a customer to manage an investment or make a non-cash payment may need an AFSL from ASIC. Services requiring an AFSL include basic deposit products. More information on AFSLs is available from ASIC.

Australian Credit Licence (ACL)

Organisations that want to provide credit to consumers or businesses in Australia, such as credit card issuers, will need to obtain an ACL from ASIC. It is possible to provide credit indirectly as part of a commercial arrangement with an existing direct ACL holder. More information on ACLs is available from ASIC.

Not all these licences are required for all payment systems. The licensing requirements for different systems are specified in the relevant section of this Guide.

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