Australia on the cusp of fintech greatness

| March 24, 2016

AUSTRALIA could become the fintech hub of Asia within years if the Federal Government proceeds with its range of reforms announced by the Treasurer Scott Morrison.

The government package will help encourage some of Australia’s best and brightest bankers to leave the comfort of the ‘big four’ banks and venture out on their own with disruptive new ideas.

This is the turning point, as political and regulatory barriers had been holding back Australia’s thriving fintech market for too long.

Australia’s financial services sector is the largest contributor to the national economy, contributing about $140 billion to GDP last year and employing 450,000 people.

The Australian Government’s package of measures will help unleash a new generation of entrepreneurs and investors who want to make everything we do quicker, easier and more productive.

They will help create a new digital backbone to the economy that needs to diversify to counter the downturn in the resources sector.

Fintech investment around the world reached an estimated US$20 billion in 2015, a jump of about seven-fold in only three years.

Australia needs to make itself fintech friendly if it wants to set itself up for the next generation of economic growth.

If it does, Australia could become the fintech hub of Asia, servicing a market of more than three billion people, including a rampant Chinese economy.

The Australian Government package involves:

·         Tax changes for early stage investment;

·         A new ‘Entrepreneur’ visa classification, targeting foreign entrepreneurs with innovative ideas and financial backing from a third party;

·         Establishing five ‘landing pads’ in Tel Aviv, San Francisco, Shanghai and two other locations, providing state-of-the-art shared workspace facilities to improve Australia’s international innovation and science collaboration with other parts of the world. It will cost $36 million over five years;

·         Improvements to insolvency law restrictions;

·         Investing $112 million to improve science, technology, engineering and mathematics (STEM) skills in fields such as health, medical care and the environment.

The package of measures is designed to promote commercial risk-taking and to encourage Australian start-ups to think global from day one.

Fintech is going to revolutionise how consumers and businesses experience financial services in the future.

But individual fintech companies can’t thrive in an analogue world. We need to create a digital ecosystem for new ideas to grow and prosper.

For this reason, Tyro created the Tyro Fintech Hub in early 2015 at 155 Clarence St, Sydney, as Australia’s first dedicated space for fintech start-ups.