Fintech adoption speeds up in Australia
Australia is growing faster than most of the global markets and is now outplacing the US in terms of fintech adoption, says Noah Breslow, the chief executive of US online SME lending company OnDeck Capital, which has delivered more than $US8 billion in loans to 80,000 small businesses globally.
He told the third AltFi Australasia Summit in Sydney on Monday that Australia is now the second-largest alternative finance market in the Asia-Pacific region.
“We are looking at an industry that did $10 million of annual volume – these are numbers from KPMG in 2013, and in 2016 that had grown to $220 million.”
Breslow said according to OnDeck estimates, “based on our own growth and the growth of other players in the industry collectively, 2018 could see around $700 million of annual volume just here in Australia”.
Even if you took an 80 per cent growth rate for the next three years, Breslow said, “you wind up with an industry that is much bigger and much more impactful than the industry we have today. So we are estimating, around 80 per cent per year moving onto 2020, a potential $2 billion in annual loan originations just here in the Australian market”.
A bigger vacuum to fill
Talking on the sidelines of the summit, Breslow said while the US has more than 6000 banks, “in Australia, you have a more concentrated banking system, which means there are fewer small business lending choices on the market. And that, in turn, means that alternative lenders like OnDeck have a bigger vacuum in some ways to fill.
“Then you look at the Australian economy. You’ve had decades of expansion so the outlook for small business owners is strong. It’s just getting stronger in many ways.”
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