Australian fintechs pull together to safeguard $1.8bn sector
Diversity and in-built agility are two factors in Australian fintech’s favour as the sector battles to withstand the economic shockwaves from the COVID-19 pandemic Radium Capital says.
Australia’s fintech sector started 2020 in good shape, with an estimated market size of $1.8bn and more than 600 companies strong. Fast-forward a few short months and today it is a different story.
Radium Capital Chief Executive Officer Cameron Owens said the stalling economy and stock market free fall meant regular sources of capital for fintechs had begun to evaporate.
“Before the crisis, Australia’s fintech sector had a record-breaking 2019 which saw growth jump by 252%,” Mr Owens said.
“This signals that our sector is increasingly important to the economy, and is positioned to play a crucial role in the country’s future success.
“Our sector counts RegTech, Back and Middle Office businesses right through to Blockchain start-ups and NeoBanks among our ranks.
“This diversity combined with our inherent nimbleness as tech companies are hidden strengths.
“We need to pull together and find ways to help our fellow tech entrepreneurs navigate these unchartered waters.
“At Radium Capital we hit reset on R&D finance by offering businesses with R&D programs quick access to cash-flow-friendly and cost-effective loans.
“We have R&D capital available to help plug the funding gap many fintechs now face.”
Providing a business has registered its R&D activity with the Federal Government and can apply for the R&D tax incentive, it can also apply for an R&D advance.
“We developed a proprietary platform that cuts through the red tape, so we can supply much-needed cash flow to companies in a few business days,” he said.
“We’d also encourage companies to reach out to government and make their voices heard on the challenges currently facing the fintech and regtech sectors.”
Since launching in 2017, Radium Capital has funded more than $310 million in research, and helped over 140 businesses across 16 different sectors.
“We have so many amazing fintech businesses in Australia that we simply can’t afford to lose,” Mr Owens said.
“If we can work together to bolster our sector, fintech can help kick-start the Australian economy once this health emergency is over.”