Home' Forge : Vol 1 No 2 Contents FEATURE // 47
By Leon GettLer
‘As the pace of technology-
enabled innovation accelerates,
it is crucial that government and
regulators be aware of, and enable,
the benefits of innovation to flow
through the financial system while
appropriately managing risks,’ the
Murray report said.
Ian Pollari, the head of banking at
KPMG Australia, and the co-lead of
KPMG’s fintech working group, says
that there are lessons that banks can
draw from the fintech space.
‘The best thing any incumbent can
do is maintain a razor-sharp focus
on consumers,’ Pollari says.
‘The reality is, incumbents have
customers already, and there’s a
strong level of trust. What they have
to do is continue to evolve their
proposition and meet the needs of
consumers, because someone else
will try to do a better job of that.’
And therein lies the problem.
Fintech companies are much
more personalised in their service
than the banks, with their legacy
Pollari says that the fintech sector
was produced by a coalescence
of forces – a perfect storm that
transformed financial services.
First, he said, was the shake-up that
happened in the wake of the global
‘If you look at it globally, post-
GFC, mainly in the Northern
Hemisphere, there’s been a lot
of people who have lost jobs
out of the industry. Hence, from
a human capital perspective,
you’ve had people leave the
industry [who] didn’t want to go
back to working for another bank.
They wanted to do something
different and, more often than
not, that was starting a new
business,’ Pollari says.
‘Probably more relevant from a
Northern Hemisphere perspective
is that there was an erosion of trust
post-GFC, and there has been an
element of growing consumer
mistrust in traditional forms of
‘I wouldn’t say that’s true from a
local perspective, but there have
been factors coming together.’
Another driving force, he says, was
governments deregulating around
the world to stimulate competition.
‘The fourth dimension is the digital
revolution, or a range of different
things that have ultimately made
it more likely,’ Pollari says. ‘One is
the proliferation of smart phones
and devices. The second is around
the explosion of social media
platforms and data generally. If you
look at the stats, 90 per cent of the
world’s digital data was created in
the last two years, and then with
that, as well, you’ve also had cloud
computing offered as a service. We
also now have low-cost software
As a result of the technology, he
says, it now costs a lot less to start
a business. The fintech sector is a
shining example of that.
‘All these things meant that maybe
10 years ago it cost a lot more to
start a new venture,’ Pollari says.
‘Now it’s really cheap to start a new
technology-enabled business and,
as a result of that, we have seen
an acceleration in the number and
diversity of new ventures in fintech’.
He says that Australia is right up
there with the trends overseas,
where there’s been an explosion of
‘It’s on a similar path,’ he says.
‘We have certainly seen a growing
number here. [Another piece of the
digital revolution] is the growing
quality of fintech entrepreneurs at a
very high level.
‘Over the last 18 months in
particular, and in more recent
times, we are having entrepreneurs
that are coming back to Australia
to start fintech companies and,
equally, we are seeing a number
of players also starting new
businesses. We have certainly seen
an explosion domestically in terms
of the number.
‘But the number is only one
[element]. It’s the quality, as well,
and I’ve been overwhelmed by the
quality of entrepreneurs starting
businesses. Some of these have
come from tech.’
Pollari says that the fintech sector
has a very different focus from the
financial services sector. For the
fintech sector, it’s all about focusing
on niches in the value chain.
‘There is no doubt that what we
are observing globally is that
there is an evolving coalescence of
customer expectation, and desire
for greater personalisation for
immediacy,’ he says.
‘[Customers] are often looking
to different sources for advice,
like family, friends and online
communities. They want to be
empowered and in control of their
finances, so you have this customer
dimension – that’s what is really
driving the shaping of the industry.
‘Fintech emerged to help identify
particular aspects of the industry
where they feel that they can do a
better job of meeting a consumer need.
There are also the fintech companies
that are providing solutions for
Links Archive Vol 1 No 1 Vol 1 No 3 Navigation Previous Page Next Page