Significant headwinds are expected for fintechs in 2023 with particular focus on the sector’s ability to perform on a global stage.
The fintech census from EY and FinTech Australia revealed challenges were expected in competing for talent.
Talent was scarce with 66% of fintechs indicating rising employee salaries were a challenge, access to skilled domestic workers (58%) and competition for talent from big tech companies (52%).
The scarcest areas of talent were engineering and software roles followed by data engineers and product managers.
Australian fintechs also questioned if they could compete on a global stage with confidence that Australian fintechs could win against international peers falling from 67% in 2021 to 57%.
The percentage who felt Australian firms were internationally competitive fell from 80% to 69%, approaching 2019 levels.
Markets in the US, UK and New Zealand remained the three most-attractive markets for overseas expansion.
With this in mind, survey respondents were in favour of measures by the Federal Government to promote the sector’s development such as start-up incentives and tax breaks.
Malia Forner, EY Oceania start-up and entrepreneurship leader said: “Government and regulatory support remains paramount for the continued growth and development of the fintech sector. Census respondents believe the new Federal Government should focus on greater founder and start-up support via incentives, supporting greater capital flow for investment, and greater support for tax incentives and grants for Australian based R&D and commercialisation.
“Incentives also provide governments with the opportunity to align growth with other policy goals such as sustainability, digital transformation or social equality. So, it’s both pleasing and critical to see growing commitment to incentivise investment, innovation, entrepreneurship, and R&D, and the economic opportunities and jobs it generates.”
