If you are looking for new opportunities for investment or business development, you might want to consider these facts and figures:
- The FinTech industry now represents 10,000 people or 16% of start-up sector in Australia.
- Venture capital investment in the Australian FinTech sector increased from $450 million in 2014 to around $700 million in 2016 and it’s still growing.
- Australia has overtaken Japan to become the second largest alternative finance sector in the Asia-Pacific region, second only to China (which has around 80% of the world’s alternative finance sector).
Danielle Szetho is the CEO of FinTech Australia. When she gave her talk, How Australia could lead the world in FinTech, at a Florence Guild event as part of the speaker series, ‘The Antidisciplinary Future’, Danielle shared these and many more fascinating insights into the trends and opportunities available in this fast-growing industry.
Let’s look at 4 of the key features of the industry that Danielle discussed.
You might be scratching your head wondering what intersections have to do with finance, but the term does seem to fit nicely.
The first intersection is geographical. Australia is on the doorstep of Asia, making it an ideal place for businesses from both the east and west to establish offices. Our society is full of people from many diverse backgrounds, so we have intersections of culture and ways of thinking. Then, as finance is primarily a service industry, it intersects with many other industries. As a result, the innovations pioneered in the Australian FinTech industry have been fueling growth and technological development in other industries such as the education, legal, health, and insurance sectors.
2. Effective regulations
The financial services industry is the largest contributor to Australia’s GDP (10%), so it makes sense that there is a good balance of government and market regulation, especially in areas like compliance. Therefore, there is less risk in investing here than in other less-regulated markets.
3. Disruption aplenty
Technology is rapidly changing how financial services engage with consumers. There is a good chance you’re already using personal budget management apps like Money Brilliant and Pocketbook. You’ve probably got apps for your bank, health insurer, and utility providers on your smartphone, too. Where would you be without any of those these days?
Personal finance providers in the open banking space are also making a big difference for all those struggling to get a loan from one of the major banks, such as freelancers and start-ups. Now they have providers willing to listen and to back them.
4. Endless opportunities
The opportunities emerging from the FinTech sector go way beyond smartphone applications and lending platforms, though. Amazon’s Alexa devices already allow us to go voice shopping from home and to pay for things via their app. Domino’s Pizza allows their customers to split the bill easily using the PayPal Bill Share function within the Domino’s app. Transaction services are wide open for new technologies like these to tap into. Blockchain technologies show great potential in areas like international remittances and trade.
Then there are all the technologies we are yet to develop for functions we can’t even conceive we’ll need in the years to come.
In a nutshell, FinTech is an area that will only continue to grow for the foreseeable future and Australia is in an ideal position to lead the way.
‘The Antidisciplinary Future’ series narrative explores how we can look outside traditional disciplines to find better ways to live and work now and in the future. Hear more of Danielle Szetho’s insights into the future of FinTech in Australia by tuning in to episode 13 of our podcast. You can also keep up to date with conversations with other thought leaders by subscribing to our podcast on iTunes and Stitcher Radio.