Australian Fintech, Forecast for 2020

Australian Fintech, Forecast for 2020

Mobile Apps, Robo-Advice, Customised Analysis Algorithms, and Blockchain will ensure a CAGR of 76.3%.

RELEASE DATE
27-Dec-2016
REGION
Global
Research Code: P91A-01-00-00-00
SKU: IT03282-GL-MR_19839

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Description

Australian FinTech revenue will grow at a CAGR of 76.3% and exceed A$4 billion by 2020, driven by reduced taxes on investments in startups, steady increase in mobile payments, and rise of Tech-savy digital natives. The Australian Fintech Sector generated A$247.2 million in 2015. Sharp growth in the Fintech market in 2016 and 2017, followed by steady increases through to 2020, is likely spur growth.

Frost and Sullivan defines the Australian FinTech sector as comprising three market segments: digital payments, personal and business finance, financial infrastructure and data analysis. Each segment’s unique method of disrupting the financial services sector relies on its own digital technologies. This report focuses on the way these segments will grow by 2020 and the challenges that FinTech companies will face.

Australian FinTech is in the development stage of the business cycle, and the FinTech start-up space has grown rapidly and is set to drive $10 billion of revenue away from existing financial institutions and ensure $3 billion worth of added revenue.

Innovation hubs provide a strong foundation for start-ups to operate and reach positive cash flow. A$438 million of investment in Australian FinTech in 2015 was concentrated in Sydney.

Some disruptors have been observed in the growing Australian FinTech market. New EFTPOS and online charging solutions will allow more merchants to be paid through credit cards but also drive down the cost of receiving payments. The replacement of financial advice teams with Robo-Advice teams will be hugely attractive to established financial institutions that want to cut labour costs. Blockchain will radically reduce costs by decentralising ledgers for financial settlements.

Market revenue in this report only includes revenues of those companies that disrupt the existing financial sector. FinTech companies included in this report use technologies that fundamentally challenge existing financial institutions.
The base year for analysis is 2015 and the forecast period is 2016 to 2020. Revenue is provided given in US dollars when pertaining to the global FinTech sector and in Australian Dollars when pertaining to the Australian FinTech sector.


Key Questions This Study Will Answer
1. What is the state of the Australian financial sector?
2. What are the global and Asia-Pacific FinTech trends?
3. What are the digital payment trends and cryptocurrencies in use, in Australia?
4. How are algo-banking, blockchain, and FinTech data analysis poised to change the face of Australian FinTech?
5. What does FinTech mean for ICT market participants?


Frost & Sullivan determines that the FinTech disrupters in the Australian FinTech sector are predominantly emerging, with a few companies already worthy of immediate acquisition or several companies on the cusp of significant growth or game-changing innovation. Frost & Sullivan believes that the response by the Australian banks to FinTech is only an emerging strategy. Most Australian banks have not declared whether their model of responding to the FinTech market is to grow partnerships or innovate internally.

Table of Contents

Key Findings—Australian FinTech 2015–2020

Key Findings—Australian FinTech 2015–2020 (continued)

Australian FinTech—Business Cycle

FinTech Investments in Australia

Mobile Payment Trend

Wealth Management Technology—Timeline

Digital Ecosystem—Key to Success of FinTech and Banks

Blockchain and Decentralization

Frost & Sullivan GI Quadrant—FinTech Disrupters

Frost & Sullivan PI Quadrant—Australian Banking Strategy

Financial Services—Next-Gen Disruption

Financial Services—Next-Gen Disruption (continued)

Research Scope and Market Segments

Market Offering by Segment

Business Models in the FinTech Industry

Definitions and Methodology

Current State of Australian Banking

Future Profitability

Changing Trends in FinTech

The Big Four—Westpac

The Big Four—CBA

Innovation Models of WBC and CBA

The Big Four—NAB and ANZ

Current Financial Sector Summary

Global FinTech Activity

Key Global FinTech Company Profiles

Key Global FinTech Company Profiles (continued)

Global FinTech M&A Activity

Global FinTech Dispersion

Asia-Pacific FinTech Activity

Asia-Pacific Innovation Hubs

Key Asia-Pacific FinTech Company Profiles

Key Asia-Pacific FinTech Company Profiles (continued)

Global FinTech Summary

Australian FinTech Market Revenue Forecast

FinTech Market Growth Drivers

FinTech Market Growth Drivers (continued)

Digital Payments Segment Forecast

Personal and Business Finance Segment Forecast

Financial Infrastructure and Data Analysis Segment Forecast

Segment Concentration Forecast

Australian FinTech Forecast Conclusions

Mobile Payments

Apple Pay

Android Pay

Other Mobile Payment Apps

Apple and Google—Threat to Paypal

Visa and MasterCard to Decline as Google and Apple Acquire FinTech Companies

Mobile Payments Summary

Cryptocurrencies

Cryptocurrencies and Volatility

Growth Drivers and Restraints for Cryptocurrencies

Cryptocurrencies and the New Payments Platform (NPP)

Cryptocurrency Summary

Key Players in the Digital Payments Segment

Key Players in the Digital Payments Segment (continued)

Market Position of Digital Payment FinTechs

Digital Payments FinTech Market Analysis

Partnerships and Business Acquisition Opportunities

What is Algo-Banking?

Self-Managed Super Funds—Key to Algo-Banking Growth

Algo-Banking to Grow with Digital Natives and SMSFs

Micro-Investing—Low-cost Investment Model for Digital Natives

AI & Digital Ecosystems

Self-Learning AI—The Future Analytics Product of Financial Services

AI Hardware Architecture—The Foundation for Customised AI Software

Hypothetical Digital Banking Ecosystem

Partnerships and Business Acquisition Opportunities

Key Players in the Personal and Business Finance Segment

Key Players in the Personal and Business Finance Segment (continued)

Market Position of Personal and Business Finance FinTechs

Personal and Business Finance FinTech Market Analysis

Personal and Business Finance Summary

Blockchain—Unexpected Disruption

Blockchain—How does it work?

Trends in Blockchain Research

Blockchain Development has Fostered Partnerships between ICT and Financial Services

Blockchain-as-a-Service

Data Analysis in FinTech

Key Players in the Infrastructure and Data Analysis Segment

Market Position of Infrastructure and Data Analysis FinTechs

Infrastructure and Data Analysis FinTech Market Analysis

Partnerships and Business Acquisition Opportunities

Infrastructure and Data Analysis Summary

Security Challenges and the Need for Security Vendors

End-user Attacks—The Highest Priority

Application-level Security—Stronger Than Browser Security

Expansion of Biometric Security

5G Connectivity and Enhanced Security

5G Connectivity and the Role of Telecommunications

Telecommunication Companies and FinTechs

Connection Security

Huge Opportunities for Data Centre Providers

Concerns in Server and Database Security

ICT and Telecommunications Opportunities will be Security Focussed

Lessons for Australian FinTech from the Global Sector

The Final Word from Frost & Sullivan

Legal Disclaimer

List of Company of Profiles

List of Company of Profiles (continued)

List of Exhibits

List of Exhibits (continued)

List of Exhibits (continued)

List of Exhibits (continued)

List of Exhibits (continued)

The Frost & Sullivan Story

Value Proposition: Future of Your Company & Career

Global Perspective

Industry Convergence

360º Research Perspective

Implementation Excellence

Our Blue Ocean Strategy

Related Research
Australian FinTech revenue will grow at a CAGR of 76.3% and exceed A$4 billion by 2020, driven by reduced taxes on investments in startups, steady increase in mobile payments, and rise of Tech-savy digital natives. The Australian Fintech Sector generated A$247.2 million in 2015. Sharp growth in the Fintech market in 2016 and 2017, followed by steady increases through to 2020, is likely spur growth. Frost and Sullivan defines the Australian FinTech sector as comprising three market segments: digital payments, personal and business finance, financial infrastructure and data analysis. Each segment’s unique method of disrupting the financial services sector relies on its own digital technologies. This report focuses on the way these segments will grow by 2020 and the challenges that FinTech companies will face. Australian FinTech is in the development stage of the business cycle, and the FinTech start-up space has grown rapidly and is set to drive $10 billion of revenue away from existing financial institutions and ensure $3 billion worth of added revenue. Innovation hubs provide a strong foundation for start-ups to operate and reach positive cash flow. A$438 million of investment in Australian FinTech in 2015 was concentrated in Sydney. Some disruptors have been observed in the growing Australian FinTech market. New EFTPOS and online charging solutions will allow more merchants to be paid through credit cards but also drive down the cost of receiving payments. The replacement of financial advice teams with Robo-Advice teams will be hugely attractive to established financial institutions that want to cut labour costs. Blockchain will radically reduce costs by decentralising ledgers for financial settlements. Market revenue in this report only includes revenues of those companies that disrupt the existing financial sector. FinTech companies included in this report use technologies that fundamentally challenge existing financial institutions. The base year for an
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Author Audrey William
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