Business and consumer demand drives Australia's surge to second largest Asia Pacific alternative finance market

New research showing Australia has risen to become the second largest alternative finance market in the Asia Pacific sends a strong signal to the world about the underlying strength of Australias fintech and business environment.Findings from a joint study by KPMG, the Cambridge Centre for Alternative Finance and the Australian Centre for Financial Studies, released today, reveals that Australias alternative finance market size grew by 53 per cent from 2015 to 2016 and has now reached US$609.6 million.According to the Second Asia Pacific Alternative Finance Industry Report, Australia has leap-frogged Japan to become the second largest alternative lending market (behind China) across the Asia-Pacific.Outside of China, Australia now contributes 30.42% of the total market in Asia Pacific and stands well ahead of Japan (US$398.45m) and South Korea (US$376.31 million) in terms of market size.FinTech Australia CEO Danielle Szetho said the reports findings showed how the Australian fintech industry in areas such as invoice financing, balance sheet lending, peer-to-peer lending and crowdfunding was servicing the nations strong economy and the needs of growing small and medium-sized businesses.The demand for our products and services is strong and our fintech lenders are rising to the challenge. This broad-based reports showcases the cumulative efforts of government and regulatory bodies like the Australian Securities and Investment Commission (ASIC) and Australian Prudential Regulation Authority (APRA) to support the accelerating momentum behind alternative finance in Australia, Ms Szetho said.The story in Australia has truly been about demand, and the small-to-medium enterprise market has driven a lot of the success in the fintech lending sector together with the increasing availability of data. In doing this, the fintech industry has helped these businesses prosper.We need to capitalise on this burgeoning opportunity for Australian fintech given SMEs are really the engine room of the Australian economy. The continual work of our fintech alternative finance players will go a long way towards creating new jobs, and helping those small businesses thrive."Ms Szetho said it was important to note that Australia is only in the early stages of developing its crowdfunding market.This means that we can expect further alternative financing growth when this market begins to establish and mature, she said.We hope that this report will mean the Asia-Pacific region and indeed the world will take a closer look at our dynamic and growing fintech industry in this country.Beau Bertoli, Joint CEO of Prospa, agreed saying that while the alternative finance market might have initially been slower to take off in Australia than in other regions across Asia Pacific, the numbers and level of investment now could not be ignored.With government confidence in fintech at an all time high in Australia, we are experiencing a regulatory environment that is more conducive to innovation than ever before, said Bertoli.Before founding Prospa five years ago, unsecured business loans simply didnt exist in Australia, and they certainly werent available online.This model of lending has transformed the way small business owners experience finance in Australia and has allowed Prospa to inject over $400 million into the economy.MoneyPlace chief executive Stuart Stoyan said he was excited to see the performance of Australian marketplace lenders.We have now moved on from being an early stage and cottage industry to be a legitimate source of funding for Australian borrowers, he said.Moula co-founder Aris Allegos said the report was a testament to the contributions lenders like Moula have been making for SMEs accessing finance.As an industry, we should be proud that were changing the lending landscape for small business owners in Australia," he said.RateSetter Australia CEO Daniel Foggo echoed these sentiments, saying that while trust and confidence in banks continues to erode, peer-to-peer lenders are building a sustainable, technology-led alternative to the bank model, offering better value to Australian investors and borrowers.The report demonstrates excellent progress for FinTech in Australia, but the local industry is still in the early stages of an exciting growth story, he said.In the UK and the USA, peer-to-peer lenders and other FinTech companies have achieved such prominence that they are no longer viewed as 'alternative' and are increasingly considered to be mainstream."About FinTech AustraliaFinTech Australia is a national association for the Australian FinTech Startup community. Our vision is to make Australia the leading market for FinTech Innovation and Investment by working with both sides of Government, Industry and the Australian FinTech community to create a supportive environment and partner ecosystem in Australia and abroad.