Passers-by are reflected on a signboard displaying currency signs outside a bank in Tokyo November 27, 2014. The dollar edged down against the yen on Thursday after lacklustre U.S. economic data pushed Treasury yields lower and dulled investor appetite fo
Passers-by are reflected on a signboard displaying currency signs outside a bank in Tokyo November 27, 2014. The dollar edged down against the yen on Thursday after lacklustre U.S. economic data pushed Treasury yields lower and dulled investor appetite for the greenback. Reuters/Issei Kato

Fintech industry leaders stated that a lack of awareness on the pace of technological progress in overseas markets is hampering Australia’s full potential in the industry. As a step towards global awareness, an alliance of 30 leading players in the Australian fintech scene has put together a policy paper that outlines the steps that will put the nation at the top spot by 2017.

Moving toward the global scene

As reported by Startup Smart in November, a group of 30 fintech startups and founders, including MoneyPlace CEO Stuart Stoyan, Stone & Chalk CEO Alex Scandurra, and Fintech Melbourne founder Andrew Lai, signed a policy paper which compares Australia’s fintech landscape to the global leaders.

It discussed how some of the leading players, such as London and New York, worked to foster their fintech industries and where Australia is falling behind. The paper said that Australia’s fintech industry must be at par, at the very least, if not lead the way in some areas.

Scandurra pointed out that this is a crucial time for Australia’s fintech industry. “Disruption comes in waves so timing is everything. The age of fintech started four years ago and if we act with focus and conviction at a political level we stand a good chance of becoming the top dogs of fintech in Asia,” he said.

With the aim of growing to be the most important player in the Asian-Australian region, Australian fintech leaders agree to zero in on some key areas of regulations and laws impacting the fintech scene: lending, wealth and insurance, equity crowdfunding, payments and data, and digital currencies and the blockchain. The paper calls out the key policy initiatives that Australia needs to put in place to ensure Australian fintech is globally relevant.

Take the best and practice it

Fintech expert Mitchel Harad, chief marketing officer of leading P2P lender SocietyOne, and payments disrupter Tyro CEO Jost Stollmann both believe that Australian start-ups need to be strategic about the talent they hire, and not just reinvent the wheel, as reported by the Sydney Morning Herald. They added that Aussie start-ups should place their minds ahead of the curve.

Harad said that local entrepreneurs should think globally and spend more time closely studying start-ups overseas and adopt their best practices. He added that his recent discussions with local start-ups aiming to create robo-advisers had displayed a shocking and disappointing lack of awareness about the developments in that market in the US.

“Look at other people. Look deep at what is working and what is not overseas,” Harad said.

This sound advice has been practised by fintechs in established hubs abroad such as London, which has arguably the most successful fintech industry. Silver Falcon Plc (SILF:LN), a shell investment company that focuses on acquiring fintech companies, is one of the firms that took advantage of its local fintech industry. The company recently floated on the London Stock Exchange, opening at 3.5 pence a share.

“Presently these fintech companies are in need of more capital to take their businesses to the next level which is where we come in with our shell of 1.5m pounds in it and the ability to raise more money if necessary,” said Adrian Beeston, one of Silver Falcon’s directors.

In a recently concluded fintech summit, Stollman emphasised the need to think big, questioning if enough local start-ups have the passion to overthrow the traditional orthodoxy. He added that collaboration between start-ups and banks have been going around, which might remain an option for some start-ups. However, he added that more entrepreneurs should be prepared to put the gloves on and fight for ways to not only disintermediate banking profits around the edges but tackle them head-on.

“Today's banking solutions suck. They are full of friction, they are not a nice experience," he said bluntly. “The problem is you have to disrupt the banker client relationships and the customer franchise. That is extremely difficult."

While fintech start-ups are in need of support from the government in order to maximise Australia’s potential in the industry, there is also a need for the industry to work towards upping the ante. Through watching the start-ups in the global scene, and emulating the practices that catapulted these companies to success, Australia’s fintech potential will bloom into a full-fledge global hub.

Contact the writer at feedback@ibtimes.com.au, or let us know what you think below.

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