Policy, regulation and broader government support are fundamental dimensions in creating a healthy and sustainable fintech ecosystem. There is a need for policy momentum to be maintained and for there to be a proactive fintech agenda at all levels of government. We explored a wide range of potential growth initiatives and those considered most effective in the eyes of Australian fintech start-ups are listed below.
Nine in ten (87%) participants agree that the top effective growth initiative is to ‘make the research and development tax incentive more accessible to start-ups’, followed closely by providing ‘Capital gains tax relief for tech start-ups first incorporated in Australia’ (85% effective). Founders interviewed are quite positive about the level of tax incentive support provided in the past 12 months and would like this to increase.
Nearly 8 in 10 fintechs (79%) state that it would be effective to have policy reforms in areas that make it easier to hire employees e.g. payroll tax reform and skilled migration visas, especially as a business grows in size. In particular, the government planned entrepreneur visas, will be a timely response to this need. Given the talent acquisition challenges that fintechs face as they grow, it is not surprising that this factor has emerged as one of the key changes that would be considered effective to help promote the fintech industry.
With open banking being under independent review in September 2017, the anticipation of positive recommendations for the setup of an open banking regime in Australia is palpable.
As fintech start-ups move forward with their technology solution, ASIC licences are an important part of a go to market strategy.