Invest
‘Lagging the world’: Australia’s fintechs grew despite lack of incentives
Invest
‘Lagging the world’: Australia’s fintechs grew despite lack of incentives
Australia’s fintech sector continues to grow, despite the challenges of the COVID-19 recession, new research has shown.
‘Lagging the world’: Australia’s fintechs grew despite lack of incentives
Australia’s fintech sector continues to grow, despite the challenges of the COVID-19 recession, new research has shown.
Research released by KPMG shows Australia has added another 104 fintechs to the market in just over 12 months.
In total Australia now has 733 active fintechs.
Commenting on the findings Daniel Teper, National Fintech Lead, KPMG Australia said the strength of the market through the COVID-19 pandemic was a positive for the sector as a whole.
“Despite the impacts of COVID-19 on the economy, increased digitisation across financial services and new customer behaviours have created new opportunities for innovation.,” Mr Teper said.
“The overall impressive net growth in the number of fintechs illustrates both the robust market dynamics and a strong support for the fintech sector in Australia.”
Fintech sector lagging behind
Despite a growing number of fintechs entering the market, venture capital investor Seed Space highlighted Australia cannot compete globally in a fintech market due to weaker global initiatives.
The capital firm points out early stage venture capital limited partnership schemes in Australia currently offer a 10 per cent tax offset to investors in “innovative companies at the early and growth stages of the startup life-cycle”, according to information on the Treasury website.
Similar incentive schemes in the US offer an up to 100 per cent tax offset for early stage fintech investors depending on the state where the investment is located, while the UK’s investment scheme offers an up to 50 percent tax offset.
Early stage fintech investors in Japan are offered a 25 per cent offset for investing in early stage companies, the Seed Space data noted.
In a submission to the Senate committee on fintech and regtech, the company said not only were the incentives available in Australia not large enough to push investor money towards the fintech sector, the concession scheme was also restricted in the types of companies investors could fund, with service businesses such as robo advisers and neo-banks excluded.
“Many Australian fintechs are excluded from these incentive programs, despite their use and development of innovative technologies, and creation of novel business models,” the company said.
In order to boost Australia’s competitiveness as a global investment hub for fintech, Seed Space managing director and founder Dirk Steller said the government should also look at investment matching programs such as those used in European markets.
“In the UK and also in the EU, there are government direct investments into VC firms often through matching programmes - i.e. the VC firm raises $50 million and the government adds another $50 million,” Mr Steller said.
“We believe the Australian Future Fund could have similar provisions.”
RELATED ARTICLES
About the author
About the author
Economy
RBA's hawkish stance reflects inflation concerns, State Street economist comments
In a recent statement, the Reserve Bank of Australia (RBA) has signaled a hawkish stance on interest rates, drawing insights from financial experts about the implications for Australia's economic ...Read more
Economy
Navigating the inflation maze: How CFOs can outsmart economic hurdles in Australia
Fresh inflation data have cooled expectations of near-term rate cuts in Australia, intensifying pressure on margins, capital allocation and demand. Rather than wait for monetary relief that may not ...Read more
Economy
Inflation concerns rise as Australia's CPI climbs to 3.8% in October
Australia's latest Consumer Price Index (CPI) figures have sent ripples through the economy, with headline inflation accelerating to 3.8% year-on-year in October, up from 3.6% in September. The data, ...Read more
Economy
October CPI results pose challenges for RBA’s monetary policy stance
In a surprising turn of events, the October Consumer Price Index (CPI) data has raised eyebrows among economists and market strategists, revealing stronger-than-expected inflationary pressures in ...Read more
Economy
Global deal activity declines by 6% amid economic uncertainty, reports GlobalData
In a year characterised by economic turbulence and evolving market conditions, global deal activity has witnessed a notable downturn during the first ten months of 2025. According to GlobalData, a ...Read more
Economy
Australia’s softening labour market puts another RBA cut in play — here’s what business should do now
A four-year high in unemployment has revived expectations the Reserve Bank could deliver another rate cut as soon as November. With quarterly GDP growth running at 0.6 per cent and annual growth at ...Read more
Economy
Rising CPI reinforces RBA’s stance as rate cut expectations remain: State Street
State Street Global Advisors says the Reserve Bank of Australia (RBA) is likely to hold its current policy outlook following the release of September quarter inflation data, which showed an unexpected ...Read more
Economy
NSW SES boosts tsunami preparedness ahead of World Tsunami Awareness Day
As World Tsunami Awareness Day approaches on 5 November, the New South Wales State Emergency Service (NSW SES) is ramping up efforts to enhance tsunami preparedness along the east coastRead more
Economy
RBA's hawkish stance reflects inflation concerns, State Street economist comments
In a recent statement, the Reserve Bank of Australia (RBA) has signaled a hawkish stance on interest rates, drawing insights from financial experts about the implications for Australia's economic ...Read more
Economy
Navigating the inflation maze: How CFOs can outsmart economic hurdles in Australia
Fresh inflation data have cooled expectations of near-term rate cuts in Australia, intensifying pressure on margins, capital allocation and demand. Rather than wait for monetary relief that may not ...Read more
Economy
Inflation concerns rise as Australia's CPI climbs to 3.8% in October
Australia's latest Consumer Price Index (CPI) figures have sent ripples through the economy, with headline inflation accelerating to 3.8% year-on-year in October, up from 3.6% in September. The data, ...Read more
Economy
October CPI results pose challenges for RBA’s monetary policy stance
In a surprising turn of events, the October Consumer Price Index (CPI) data has raised eyebrows among economists and market strategists, revealing stronger-than-expected inflationary pressures in ...Read more
Economy
Global deal activity declines by 6% amid economic uncertainty, reports GlobalData
In a year characterised by economic turbulence and evolving market conditions, global deal activity has witnessed a notable downturn during the first ten months of 2025. According to GlobalData, a ...Read more
Economy
Australia’s softening labour market puts another RBA cut in play — here’s what business should do now
A four-year high in unemployment has revived expectations the Reserve Bank could deliver another rate cut as soon as November. With quarterly GDP growth running at 0.6 per cent and annual growth at ...Read more
Economy
Rising CPI reinforces RBA’s stance as rate cut expectations remain: State Street
State Street Global Advisors says the Reserve Bank of Australia (RBA) is likely to hold its current policy outlook following the release of September quarter inflation data, which showed an unexpected ...Read more
Economy
NSW SES boosts tsunami preparedness ahead of World Tsunami Awareness Day
As World Tsunami Awareness Day approaches on 5 November, the New South Wales State Emergency Service (NSW SES) is ramping up efforts to enhance tsunami preparedness along the east coastRead more
