NSW urged to ensure Sydney captures new financial services jobs in fintech

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NSW Urban development
A building (C) owned by Morgan Stanley's Australian real estate unit Investa Property Group can be seen in central Sydney, Australia, July 28, 2015. Reuters/David Gray

A report by KPMG, prepared for the Committee for Sydney, indicates that the NSW government must lift efforts to ensure Sydney captures new financial services jobs in fintech. It comes amid competition from Melbourne and Singapore intensifies.

The report, titled Scaling the fintech opportunity for Sydney and Australia, also calls on the federal government to assist in expediting policy frameworks to open up "enabling" areas. These include cyber security, digital identity and open data.

Furthermore, the report says the policy makers must create more effective mechanisms to educate consumers and businesses alike on digital financial services. This would help raise awareness and engage the university sector and research institutes.

Competition to attract technology giants and start-ups that are redefining the future of banking is in progress, with fintech automation set to slice several paper-pushing jobs in financial services incumbents. The report urges the government to take further steps in promoting Australia and Sydney as leading global financial services centres focused on fintech and digital innovation.

Fintech start-ups in Australia

Fintech start-ups here are now up to 579 from less than 100 in 2014. At least 59 percent is based in Sydney.

The report has found that these start-ups are providing jobs for over 10,000 people. The figure is expected to grow further, particularly if the start-ups can influence customers to allow them to scale-up.

Among the factors that drive fintech include declining trust in large institutions and increasing customer demand for faster and more convenient finance and payment services. The report also notes that regulatory support for start-ups helps fintech start-ups.

KPMG's national banking head and global co-leader of fintech Ian Pollari said there have been some talks about the fintech opportunity over the past years. Today, the sector must show it is capable of delivering by focusing on outcomes."We need to do a better job selling what we have built to the world, we can be too internally focused as a country," the Australian Financial Review quotes him as saying.

The Australian fintech investment remained strong despite the global slide in fintech investment in 2016. According to the report, Sydney has a competitive advantage in some areas like payments, blockchain and regtech.

The state government is urged to seek to attract global talent to these "priority areas" areas. The KPMG said the onset of new payments platform later this year should provide a significant boost to payment innovation.

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