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What is a Payment Platform?

A payment platform is a form of online infrastructure that supports online money transfers and serves as an electronic alternative to traditional paper methods like cheques and money orders.
How is a Payment Platform Regulated?

The first step into the market will always be determining whether you need to obtain an Australian Financial Service Licence (“AFSL“) and then applying for the appropriate authorisations.

Depending on how a payment platform is operated, the platform will most likely be considered a Non-Cash Payment (“NCP“) facility, meaning the platform allows payments, or causes payments to be made, otherwise than by physical delivery of Australian or foreign currency in the form of notes and/or coins.

Where the platform is regulated as a non-cash payment facility, you will be required to hold an AFSL in order to operate the payment platform unless the exemption applies.

What are some Common Features of a Payment Platform?


If a payment platform is operated as a wallet where customers can store funds in the wallet for the ease of making and receiving payments, the payment platform will be regulated as a NCP facility. Therefore, a business wanting to operate a wallet will be required to have an AFSL which allows them to issue a NCP facility.

Currency Conversion

Where a payment platform is designed to facilitate international payments in different currencies, it is important that the payment platform has the foreign exchange function allowing the funds to be converted into different currencies when making and receiving payments.


Exemption to Licensing

If you intend to operate a small business offering remittance payments, you may be eligible for an exemption where your operations meet the following criteria:

  • the issuer (i.e your business) is an operator of a payment system;
  • payment is made (i.e. money is available to the recipient) within two business days;
  • the funds are transferred electronically; and
  • there is no standing arrangement with customers under which funds may be transferred electronically;
  • the contract to exchange one currency (whether Australian or not) for another must also be settled immediately.

If all of the above criteria are met you may not need to apply for an AFSL, however, you will be required to register as a remitter with AUSTRAC. For more information on the remittance registration, please refer to our Remittance webpage.

Sophie Grace can assist you to determine whether your business falls within the exemption criteria listed above, please contact us for further information.

Does the AML/CTF Regime Apply?

Whether you are required to have an AFSL or only operate as a remitter, you will be required to comply with the AML/CTF Act and Rules.

However, depending on the business model and the nature of platform to be provided, the transaction reporting obligations may vary. It is crucial for payment platform operators to understand their AML/CTF obligations, establish an appropriate AML/CTF compliance program, including an AML/CTF Policy and Risk Matrix, carry out staff training and conduct regular compliance reviews of its implementation of the AML/CTF compliance program.

How can Sophie Grace Help you?

If you are still unsure whether your proposed business requires an AFSL or AUSTRAC remittance registration, Sophie Grace can provide you with effective and practical guidance tailored to your business. Please contact us for further information.

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