In 2015 the Turnbull government spruiked the innovation nation. Two years on, we check in to see how it’s following through on fintech.

Australia’s “ideas boom” was at the forefront of the national agenda two years ago and financial technology, or fintech, was set to play a starring role. The Turnbull government’s $1.1 billion National Innovation and Science Agenda promised an economic boom built on the back of start-ups boasting cutting-edge technology. Fintech formed a major plank of that agenda with Treasury setting out a list of priorities that would position Australia as a global leader in innovative financial services.
But much has changed since these priorities were outlined. The government has grappled with a host of issues including its ongoing citizenship dramas and the marriage equality vote, and fintech has slowly slipped from the spotlight. So did the government just have a short-lived love affair with the sector or was it a lasting commitment?
“We’re seeing very strong continued support from the government and, in fact, from both sides,”

Treasurer tuned in

The latter, says the Chief Executive of FinTech Australia, Danielle Szetho. Szetho maintains fintech innovation is gathering strong momentum and she is adamant that government backing is keeping pace. “We’re seeing very strong continued support from the government and, in fact, from both sides,” she says. “We’ve actually had a number of really great continuous engagements with a number of stakeholders.
“[Treasurer] Scott Morrison in particular has always been a very strong and passionate advocate for the industry,” Szetho says, adding that Morrison’s support continues through the FinTech Advisory Group, with which he meets regularly.
“We’re also starting to see a bigger engagement with other groups such as the Digital Transformation Agency, with respect to their digital identity projects,” she says. “Even on the opposition, we’ve had great dialogue with Ed Husic [member for Chifley, in Western Sydney] about where to develop the agenda to continue to support the industry.”

Ready for take-off

Although it may not be generating the same headlines as when Prime Minister Malcolm Turnbull was in full campaign mode and launched app OnMarket in 2015, the fintech sector is growing rapidly, researchers say. The EY FinTech Adoption Index found 37 per cent of people in Australia regularly use fintech services – one of only nine countries above the global average of 33 per cent.
The report revealed an increasing number of Australians were turning their backs on traditional banking and opting for new fintech services such as mobile phone payments at checkout and digital-only banks. In 2015, 23 per cent of those surveyed said they preferred to use traditional financial services compared with just 10 per cent in 2017.
These figures point to an enlivened sector that is moving beyond its infancy, says Szetho. And in many ways, despite the lack of headline news, the fintech sector is also showing healthy growth. “We’re seeing more companies come out, we’ve seen at least a doubling of the numbers of fintech companies in the last 12 months,” Szetho says.
“We’ve seen investments on the rise and we’ve seen some really interesting and innovative ideas that are actually also starting to get to the IPO stage and are floating with success.”
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