The Australian Securities and Investments Commission is taking a tougher approach to approving Australian Credit Licence and Australian Financial Services Licence applications, with approvals now routinely taking four months or more and the number of rejections increasing.Sonia Cruz, a senior consultant at The Fold Compliance, said ASIC's approach started to change after the implementation of the FOFA legislation, which gave it increased licensing power.Under FOFA, ASIC was given the power to refuse, cancel or suspend a licence where a person is "likely" to contravene their obligations. The old test was "will breach" their obligations, which was much harder to satisfy.Another FOFA change was that, when assessing whether a person is of good fame and character in licensing decisions, ASIC could consider any conviction for an offence involving dishonesty that is punishable by imprisonment for at least three months. FOFA has been in place since July 2013 but Cruz said the change in ASIC's approach had been particularly noticeable over the past 18 months."ASIC's licensing analysts now look for evidence indicating that applicants might be unlikely to comply with the law," she said."They actively look at past conduct, especially any disregard of the financial services or credit laws. They are using social media to assess character and calling up company records to verify financial information."ASIC is also checking the files of external regulatory agencies for information about compliance.Cruz said applicants should expect their applications to take considerably longer than in the past. ASIC has a KPI requiring it to process applications in 60 days but it is more likely to take four months or more."The number of applications being rejected is going up," she said.In May ASIC said it would revise its licensing kit, which is contained in regulatory guides RG1, RG2 and RG3. The updated kit is yet to appear."Even through ASIC appears to be taking a different approach to assessing applications, guidance hasn't yet materialised," Cruz said."We think ASIC's enhanced power is a good thing. Licensing allows ASIC to play an important industry gatekeeper role."But it makes it difficult for people applying for a licence if they don't know what information they will need to submit with their application.""And because of the long delays businesses can't plan. This is particularly difficult in the fintech market, where timeliness is very important."Cruz said it had become more important for applicants to ensure that information in applications matched the information that ASIC might check on LinkedIn and other social media sites."The regulator will be looking for consistent disclosures," she said.