'British fintechs set sights on Aussie market' Hans Van Leeuwen, AFR
London | Australia's big four banks had better watch out: the British fintech cavalry is coming. Ten of Britain's "sector-leading" fintech companies, from small- and medium-enterprise (SME) banking to superannuation back-office support, are to be given UK government backing to crack the Australian market.
There aren't big bucks involved: the British government's Department for International Trade instead will offer a pilot program under the "UK-Australia Fintech Bridge", taking the companies Down Under and offering them mentoring and network advice.
It is understood none of the businesses is yet in the Australian market, though most are planning an incursion. Some will compete with the big four, while others will offer complementary services and look for partnerships with existing players.
British fintech companies are hoping to crack the less developed Australian market. Peter Howell
One of the companies, Fractal, uses data aggregation and analytics to help SMEs understand their business and develop better cash management, insurance cover, payments systems and access to credit.
"Australia is the top priority market for our expansion strategy," Fractal chief executive and co-founder Nicholas Heller said.
"We''re excited to begin our journey in Australia this year, and start shaking up the financial services ecosystem that has deeply under-served small businesses for decades."
Fractal has worked closely with the British authorities before, having taken part in a so-called "sandbox" – a co-operative, exploratory pilot program overseen by the regulators – that looked at digitising lending and updating creditworthiness scores in real time.
You can get insurance for a single hour. Or you might need working capital for just half a day.
Mr Heller recently told an Australia-UK Chamber of Commerce function that the sandbox had allowed companies to "reimagine how you deliver financial services".
"In the US, you can get insurance cover for a single hour. Or you might have a working capital need for just half a day," he said. These were the kinds of possibilities fintech companies could unlock for SMEs.
He said the opportunities in Australia were likely to expand once the open banking regime was in place. This is scheduled for July unless the election prompts a delay. As in Britain, this would drive the banks to open up their data in ways that would allow other companies to create value-add services for customers.
Among the other British companies making the cut for Fintech Bridge support into Australia are:
SmartPension, backed by JP Morgan and Legal & General, which offers an app to help super fund members get real-time access to their savings information and plan their pension. It also runs a master trust and helps companies set up workplace superannuation schemes.
TradingHub offers banks, asset managers, hedge funds and regulators ways to detect market abuse and rogue traders, as well as identify and assess best-practice execution and trading.
TrueLayer creates application programming interfaces for banks in the open banking world, allowing customers to access and work on their bank data and facilitating banking transactions.
Recordsure harvests data from customer interactions with a bank, to identify problems, streamline processes and cut costs.
Thyngs offers technology that companies can use to allow a smartphone user to carry out transactions such as buying products, making donations, or earning rewards points by just pointing and clicking, without an app.
Pirkx is an open-access suite of workplace benefits, such as health, shopping and holiday benefits, for self-employed and contract workers.
Disberse is a financial institution built on distributed-ledger technology that facilitates global transactions by aid donors and recipients.
Crowd2Fund is a portal for crowdfunding and peer-to-peer lending, aimed at debt investors and borrowers.
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