We have noticed media reports this morning about a survey by Oracle into Australia’s fintech market penetration, compared to other international markets.
We have not had the benefit of seeing the survey at this time.
However, the survey would appear to ignore other compelling evidence about the strong growth of Australia’s fintech industry.
For instance, last year’s EY FinTech Adoption Index shows that Australia has among the best fintech market penetration in the world, ahead of other advanced markets such as Hong Kong, Singapore and the United States.
The Index shows that Australia is now ranked fifth highest out of 20 surveyed markets for fintech consumer adoption. This represents a big improvement from the 2015 index.
This report was comprehensive – being based on 22,000 online interviews across the world.
In addition, our EY FinTech Australia Census from 2017 showed the Australian fintech industry is rapidly maturing and growing, with companies enjoying a 200 per cent annual median revenue jump and increasingly planning to expand overseas.
The fact that we now have large fintech companies in place in Australia – such as Prospa (business marketplace lending) and Society One (business and consumer peer-to-peer lender) is an indication of how our industry is now being a real force in Australian financial services.
In addition, FinTech Australia’s own membership has experienced strong growth – from around 50 founding members in 2016 to more than 200 today.
The overall industry itself is estimated to have more than 600 companies, giving us arguably more fintech companies than Singapore and Hong Kong.
As much as our industry is growing and healthy, there are clearly also many challenges and more work to be done.
The Census mentioned above outlines some of these challenges – including the difficulty that fintechs have collaborating with banks, improving the talent pool, the need to swiftly introduce an open banking and digital challenger bank regime and the need for improved fintech access to the New Payments Platform.
It for this reason that, in our submission to the Productivity Commission inquiry into competition in financial services, we have called for a new Australian fintech industry development strategy, to define the regulatory and other steps which are required to grow our industry. Government and industry should work together to drive this strategy, but the development of the strategy does require specific government support.
We have also agreed with the Productivity Commission’s call for a far stronger regulatory framework to drive competition in financial services.