An independent survey released last week shows that Australia has achieved world-leading growth in its FinTech industry. This offers proof that recent actions undertaken by the Turnbull Government to attract investment in innovative financial services technologies have been worthwhile.
Investment in Australia’s FinTech industry hit a new high in 2016, with US$656 million invested across 25 deals, according to analysis by KPMG released on 21 February 2017.
This reflects an annual average growth rate of around 90 percent over the four years to 2016.
Australia did well to attract the additional investment in 2016 against the backdrop of global weakness. Analysis shows a 47 percent slide in FinTech investment globally to US$24.7 billion.
The Turnbull Government is keenly aware that the financial services sector plays a critical role in the Australian economy.
In his testimony to the House of Representatives Standing Committee on Economics last week, the Governor of the Reserve Bank of Australia, Dr. Philip Lowe highlighted the important role that FinTech can play in promoting efficiency, competition and improved customer experiences.
The Government welcomes Governor Lowe’s comments that the Payment Systems Board has discussed the opportunities that distributed ledger technology (sometimes referred to as block-chain) could offer in the payments system and in financial market infrastructures.
The Hon Scott Morrison MP, Treasurer of the Commonwealth of Australia, announced in February 2016 the establishment of a FinTech Advisory Group which he engaged with regularly throughout 2016 on issues important to the industry.
The Advisory Group has already made some real progress, advising on the introduction of measures such as: the CSIRO Data61 review of opportunities for distributed ledger technology (block-chain); the Productivity Commission’s examination of ways to improve data availability and use, the introduction of a regulatory sandbox to support new entrants testing their financial services offerings and the extension of venture capital tax concessions for early-stage investment to start-up FinTech.
Whilst these measures have been successful and well received by industry, the Turnbull Government continues its FinTech agenda by commencing work on an enhanced package of further reforms to be released and implemented this year.
The Turnbull Government has announced its intention to stop the ‘double taxation’ of digital currencies under the GST regime and the development of legislation to extend the crowd-sourced equity funding framework to private companies.
Financial technology – or FinTech – is transforming Australia’s financial system and potentially the entire economy.
The Turnbull Government is committed to ensuring Australia is at the forefront of the global FinTech industry so that we can drive improvements and enable more beneficial financial services for Australian consumers as well as help to positively transition the country's economy.
The Government’s FinTech statement, ‘Backing Australian FinTech’ was released last year and is available at the Fintech website.
Read the media release here.