A CLEAR COMPARISON
Core comparison: regimes, business activities and application pathways
A business name cannot replace the statutory definition. First assess the actual services, products and customers, then evaluate whether a new application, acquisition and both regulatory regimes apply at the same time.
This is not an automatic licensing matrix.
Even if a business has both an AFSL and AUSTRAC registration, this does not imply that it can operate any type of exchange, bank, consumer credit business or virtual asset platform.
REGULATORY FRAMEWORKS
How financial licensing and anti-money laundering regulation fit together
| Comparison criteria | ASIC / AFSL | AUSTRAC |
|---|---|---|
| Nature of the regime | ASIC grants AFSL and specifies the financial services, financial products, clients and additional conditions in the licence. | Regulated entity enrolment; registration for specific remittance and virtual asset businesses; ongoing AML/CTF oversight. |
| Key legislation | Corporations Act 2001, relevant regulations, licence conditions and ASIC regulatory guidance. | AML/CTF Act 2006, applicable rules, and the commencement and transitional arrangements for reforms. |
| Regulatory focus | Financial services conduct, consumer protection, product disclosure, personnel competence and financial resources. | Money laundering and terrorism financing risks, customer identity, transaction monitoring, reporting and record keeping. |
| Business assessment | Actual financial services activity + financial product scope + Retail / Wholesale clients. | Section 6: designated service + Australian territorial connection + thresholds and exemptions. |
| Personnel and resources | Responsible managers, governance, fitness and propriety, compliance arrangements and financial resources; some services have specific thresholds. | Governance and risk assessment, AML/CTF compliance officer, and systems and resources proportionate to risk; registration cannot replace AFSL financial requirements. |
| Ongoing obligations | Licence conditions, reporting, financial and audit requirements, dispute handling, material breaches and personnel changes. | CDD, applicable reports such as SMR/TTR, record-keeping, independent assessment, registration renewal and information updates. |
| Key points for acquisitions | Complete Authorisations, additional conditions, client scope, responsible managers and procedures for changes of control. | Actual registered entity and status, designated services, programme, historical reports, controllers and procedures for changes to registration. |
COMMON BUSINESS MODELS
Regulatory analysis of 14 typical business activities
The following is a preliminary classification, not legal advice or a conclusion on the licence required in an individual case; see the relevant guide for detailed conditions.
| Actual business | ASIC / AFSL or other permissions | AUSTRAC |
|---|---|---|
| Stockbroking | Usually involves Securities + Dealing; Advice alone is insufficient. | Where providing a designated service, register and meet AML/CTF obligations. |
| CFD Contracts for difference broker | Usually involves authorisation for the issue, trading or market-making of Derivatives. | Assess registration and AML/CTF by reference to the specified services and territorial connection. |
| Foreign exchange margin trading | Check against the foreign exchange contracts/derivatives and the actual transaction services AFSL. | Applies where a designated service under the legislation is involved. |
| Foreign currency exchange involving cash only | Do not directly equate this with a foreign exchange contract AFSL; assess the nature of the product and any exemption. | Cash exchange is generally a designated service; it is not synonymous with RSP registration. |
| Cross-border remittances | A payment facility or other financial product model may also involve AFSL. | Usually, RSP registration is required; distinguish between Independent, RNP and Affiliate. |
| Virtual asset-to-fiat exchange | Depending on whether the asset and service constitute a financial product, while taking account of the transition to the new framework. | Usually, VASP registration is required; check the actual services under Item 50A. |
| Virtual asset-to-virtual asset exchange | An asset is not automatically exempt from AFSL merely because it is called “cryptocurrency”. | Check Item 50B and the corresponding registration and AML/CTF. |
| Virtual asset custody | Depending on the nature of the financial product, custody model and future TCP regime. | Check Item 46A; account and private key management arrangements are important. |
| Securities token issuance and trading | Usually, AFSL and securities offering/market facility requirements should be assessed. | Applies when the designated service is provided; it is not automatically exempted by AFSL. |
| Private fund management | Usually, an appropriate AFSL or a specific statutory exemption is required; wholesale is not a blanket exemption. | Assess according to the actual service, not the name ‘fund’. |
| Investment adviser | Check general/personal advice and product authorisations separately; personal advice has additional requirements. | No. Not all advice-only services trigger designated services. |
| Non-cash payment products | The financial product definition, the actual service and any applicable exemptions all determine the position. | Assess money transfers, stored value and related designated services. |
| Ordinary consumer lending | Usually, first assess ACL rather than using AFSL as a substitute for a consumer credit licence. | AML/CTF applies when a specified service relating to lending/financing is provided. |
| Buying and selling gold bullion | Physical goods transactions differ from financial products; derivatives/interests may involve AFSL. | Assess designated bullion services and applicable thresholds and exemptions. |
APPLICATION OR ACQUISITION
Do not treat an acquisition simply as “a faster way to buy a licence”.
| Comparison criteria | New application | Acquisition of a Licensed Entity |
|---|---|---|
| Business fit | Apply for appropriate authorisation for the proposed operating model, with materials that reflect actual readiness. | Existing authorisations must be matched item by item; checking only the licence number or commercial shorthand is not sufficient. |
| Historical liabilities | The focus is on the applicant’s background, resources and business readiness. | Existing tax, client assets, liabilities, disputes and regulatory history also need to be checked. |
| Personnel continuity | Establish responsible managers and a compliance team that meet the competence and fitness requirements. | Confirm whether the responsible manager will remain in the role; actual performance of duties cannot be replaced by “lending a name for RM”. |
| Regulatory procedures | New application or authorisation change and the corresponding review. | Assess entity continuity, changes of control, notifications or approvals, and changes to authorisations separately. |
| Budget components | Official application fees, personnel, systems, consultancy and operational preparation. | The purchase price, due diligence, transaction legal costs, changes, remediation and ongoing operations all have costs; it is not just the price of the licence. |
| Timeframe assessment | Subject to the completeness and complexity of the materials and official review. | Subject to due diligence, conditions, bank review, personnel and regulatory processes; a faster outcome is not guaranteed. |
Sources: ASIC financial services licensing guidance, AUSTRAC designated services and registration information. Verified on: 5 November 2026. See the relevant topic guides for detailed official links.
LET’S DEFINE YOUR NEXT STEP
Clarify the business scope first, then plan the application pathway.
Tell us about the proposed business, customer categories and whether you are considering an application or acquisition; Mr Tang will discuss the preparations with you.