The Australian Securities & Investments Commission (ASIC) set out its approach to artificial intelligence in banking in a keynote speech by Chair Joe Longo, backing customer-centric AI innovation but warning that firms will face enforcement where AI is deployed irresponsibly and causes consumer harm. ASIC indicated it is not moving quickly to introduce AI-specific regulation, but expects regulators to use existing technology-neutral powers more assertively as AI use expands. The speech emphasised that current legal “guard rails” already apply to AI, including directors’ obligations under the Corporations Act, and that narrowly targeted AI rules could add complexity and compliance burden. At the same time, ASIC flagged ongoing supervisory focus, noting its earlier review of 23 Australian financial services and credit licensees using or planning to use AI found gaps in how consumer risks were assessed and, in some cases, governance arrangements lagged AI deployment. ASIC also said it will soon publish a follow-up to its Better Banking for Indigenous Consumers work, focused on fee harm to low-income customers nationwide, with the program already driving millions of dollars in fee refunds and migrations of eligible customers into low-fee accounts.
Australian Securities & Investments Commission 2025-07-23
Australian Securities & Investments Commission signals no rush to AI-specific rules for banks while preparing tougher use of existing powers
The Australian Securities & Investments Commission (ASIC) supports customer-centric AI in banking but warns against harmful AI use. Chair Joe Longo noted existing laws like the Corporations Act apply to AI, and specific AI regulations may add complexity. ASIC's review found gaps in consumer risk assessment and governance in financial services using AI. A follow-up on the Better Banking for Indigenous Consumers initiative will address fee harm to low-income customers.