MyBudget Driven to Apply for AFS Licence Following ASIC Investigation

The Australian Securities and Investments Commission (ASIC) today announced that MyBudget Pty Ltd(MyBudget), Australia's trusted leader in personal budgeting, has applied for an Australian financial services licenceAFSL) after the regulator conducting an investigation into its operating model.

As detailed in the official announcement, MyBudget holds an Australian credit licence and is a member of AFCA. However, the company has never held an AFS licence and was not authorised to provide financial services.

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MyBudget’s business involves developing a budget plan to assist clients to meet their financial objectives and goals. Once the budget is developed, MyBudget offers a service to manage the budget on the client’s behalf. MyBudget’s service involves the client depositing their income into a MyBudget account, from which MyBudget then facilitates the distribution of funds in accordance with the budget plan.

In May 2020, MyBudget was subject to a ransomware incident, which caused a system outage. The outage left MyBudget’s 13,000 clients unable to access their online account for at least seven days, meaning clients were unable to view their account balance and clients did not know whether automated payments had been made.

MyBudget was still able to process client payments manually, although some clients faced significant delays and difficulties reaching MyBudget through the phone line.

ASIC subsequently commenced an investigation into MyBudget to consider whether it was operating a financial services business without holding an AFS licence.

Finally, ASIC has formed the view that MyBudget is providing services to its clients via a non-cash payment facility, which would require the company to hold an AFS licence. 

MyBudget has now applied for an AFS licence and ASIC is currently assessing this application.