Simplifying regulatory landscape
The chief executive of the Financial Markets Authority (FMA) has told non-bank lenders, including those providing vehicle finance, that the creation of a single regulator will soon simplify oversight of the finance sector.
Samantha Barrass was one of the main speakers at the Financial Services Federation (FSF) conference in Auckland and discussed the looming transfer of responsibility for consumer lending from the Commerce Commission to the FMA.
She told the 180 attendees at the October 22 event that the financial services sector plays a key role in enabling New Zealanders to borrow for the things they value, “such as buying a car or a house, or for other important things that they need in their lives”.
“Our role, as a conduct regulator, will be to ensure customers are treated responsibly and that financial service providers act with integrity in that process,” added Barrass.
Commerce and Consumer Affairs Minister Andrew Bayly announced this year the FMA will become the regulator of the consumer credit industry in 2025 as part of efforts to streamline the regulatory landscape.
The government also plans to introduce a new licensing model to bring consumer lending in line with other entities regulated by the FMA.
Barrass told the conference that as a conduct regulator, the FMA will have a different set of regulatory tools compared to the commission’s role as a competition and consumer watchdog.
“I believe, and hope, that having a single conduct regulator for the financial markets will simplify the regulatory landscape across the sector,” she explained.
“The Financial Markets Conduct Act, alongside other laws, gives us a broad toolkit, which allows us to provide flexible and proportionate regulation of firms within our remit. This includes providers of financial advice, registered banks, non-bank deposit takers, insurers, and soon, of course, non-bank lenders and finance companies.”
She added that the FMA will take an engagement-led approach, which means it will look to build solid, long-lasting relationships with companies and the industry bodies that represent them
“The Financial Services Federation’s engagement with the Council of Financial Regulators … has been helpful for us as we start turning our minds to our incoming credit responsibilities,” she said.
“These engagements help us better understand your priorities and also your concerns, especially during this period of significant regulatory change.
“I’m looking forward to engaging further with you in the months and years to come.”
Bayly also spoke at the conference, which was held at the Grand Millennium Auckland and featured talks on topics such as cyber attacks, business confidence and commercial lending.
