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The current government commitment to support Australia’s growing fintech industry may not be enough to see it succeed on a global scale, according to local fintech platform FundX.
Speaking to financialobserver, FundX chief executive David Jackson said while the positive rhetoric on innovation was a good omen for the fintech industry, competing internationally with other innovation hubs would prove difficult without greater financial backing.
“When you look at it on an international scale we are lagging behind,” Jackson said. “The government has talked about $200 million to promote fintech and I think there are a few zeros missing from that figure.”
Compared to the public funds committed to promoting innovation and entrepreneurship in established fintech hubs like Israel and the United Kingdom, Australia was still on the back foot, he said.
This could prove detrimental to Australia’s economic transition away from the mining boom.
“The problem is there is a receding level of tax revenue contra to the level of demand on the tax pool, which increases the importance of fostering a digital ecosystem that does flourish, that will help the economy,” he said.
“We are also finding a need for skilled workers – everyone is crying out for graduates in technology and there is a shortage of those people, so there needs to be more discussion about what we can do to attract skilled graduates.”
FundX, a peer-to-peer platform providing invoice finance for small to medium enterprises (SMEs), boosted its own team with the announcement yesterday of two new directors, Chris Noone and Chris Whitehead.
Noone, chief executive of ASX-listed Collaborate Corporation, operator of peer-to-peer sites DriveMyCar, MyCaravan and Rentoid, has a strong background in fintech start-ups, while Whitehead as a former chief executive of Credit Union Australia and head of BankWest’s retail division brings experience in established financial services businesses.
Jackson added that the group was well advanced on launching its retail managed investment scheme (MIS), which would enable retail investors and advisers to invest in loans on the FundX platform.
“We are in the process of applying for the [Australian Financial Services Licence], so it’s something that’s tracking along,” he said, adding that the MIS was expected to be live by the end of 2016.
“We are still in soft launch mode until we can finalise the technology of the platform, but we’ve already loaned around $1.5 million to SMEs through private money and we are negotiating with a large ASX-listed institution who are interested in providing funding for us to grow the loan book.”
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