Insights from the EY FinTech Adoption Index and EY FinTech … · 2018-05-21 · EY’s Global Fintech Adoption Index “Adoption: accepting or starting to use something new.” Cambridge,

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Insights from the

EY FinTech Adoption Index and EY FinTech Australia Census

Erik Heller

EY Sweeney

May 2018


FinTech Adoption Index 2017


EY’s Global Fintech Adoption Index

“Adoption: accepting or starting to use something new.”

Cambridge, Dictionary

• 2017 global online survey of over 22,000 consumers

• 20 markets across Americas, Europe, Africa and APAC

• 8 markets also covered in 2015

• Next edition scheduled for late 2018/early 2019

RESEARCH METHOD• Comprehensive research to highlight where FinTech is

gaining traction

• Identifies 17 different types of FinTech services in five broad categories

• FinTech usage/adoption defined as having used two or more FinTech services in the last six months

Money transfer and payments

InsuranceSavings and investments

Financial planning

Borrowing


Fintech has achieved initial mass adoption in most markets

Progress of FinTech adoption globally and across 20 markets


FinTech adoption more than doubled in key markets

Comparison of FinTech adoption in six markets between 2015 and 2017

2015 adoption 2017 adoption

37

1318

8

3229

15

23

14

42

17

33

Australia Canada Hong Kong Singapore UK US

Australia has one of the fastest

growing FinTechadoption rates.


New services and new players are driving higher adoption

Comparison of FinTech categories ranked by adoption rate in 2015 and 2017

2015

1 Money transfer and payments: 18%

2 Savings and investments: 17%

3 Financial planning: 8%

4 Insurance: 8%

5 Borrowing: 6%

2017

1 Money transfer and payments: 50%

2 Insurance: 24%

3 Savings and investments: 20%

4 Financial planning: 10%

5 Borrowing: 10%


FinTech adoption across age brackets

Age (years)

37%

48%

41%

30%

22%

15%

9%

18-24 25-34 35-44 45-54 55-64 65-74 75 andabove

Views on digital financial services, FinTech users

versus non-users (%)

64

54 54

38

29

34

FinTech users Non-users

I prefer to manage as many aspects of my life

via digital channels as

possible

I mainly use my smartphone to access financial

services products rather than a

desktop computer or laptop

I am generally willing to take the most convenient financial services

product even when it is not the

cheapest

FinTech users prefer digital solutions to manage their lives


1513

812

29

15 1417

3337

13

40

18

69

27

3532

52

26

14

36

2723

3532

37

30

42

33

52

43

32

69

34

77

40

47

52

80

52

23

71

36

56

71

5356

44

53

46

2015 2017 Future

FinTech adoption will continue to gain momentum

Comparison of past, current and anticipated future use of FinTech, by market (%)

Average Australia Belgium and Luxem-

bourg

Brazil Canada China France Germany Hong Kong

India Ireland Japan Mexico Nether-lands

Singapore South Africa

South Korea

Spain Switzerland UK US


Comparison of current and anticipated future use of FinTech, by FinTech category

2017 use Future use

50%

10%

20%

10%

24%

65%

18%

33%

20%

39%

Money transfer and payments

Financial planningSavings and investments

Borrowing Insurance

Accelerating adoption in smaller categories will fuel growth


FinTech adoption is expected to surpass 50%

Analysis of current and future use of FinTech

Majority of non-regular

FinTech users have begun the

journey to FinTech adoption.

Analysis on future intended

use suggests adoption will

increase to 52%.

-4

1

33

Current FinTech users

Estimated lapsed users

Current users of one service

Current non-users

Anticipated future users

11

12 52


Comparison of two selected barriers to adoption in six markets between 2015 and 2017

Was not aware they existed

Prefer to use a traditional financialservices provider


Prefer to use a traditionalfinancial services provider








Prefer to use a traditional financialservices provider

2015 2017

Australia Canada Hong Kong Singapore UK US

44

23

49

29

16

11

42

17

34

14

40

2219

10

22

18

12 1215

11 11

5

1513

Barriers to increased adoption are evaporating quickly


FinTech Australia Census


“In 2016, FinTech Australia had identified some 250 FinTech

companies in Australia. We now estimate there’s close to 600. From

Hobart to Townsville, Perth to Gold Coast – great FinTech companies

emerging everywhere.”

Danielle Szetho, CEO FinTech Australia

OTHER EY FINTECH

REPORTS/ RESOURCES

QUANTITATIVE RESEARCH:

166 ONLINE SURVEYS

QUALITATIVE RESEARCH:

10 IN-DEPTH INTERVIEWS

VOX-POPS:

16 INTERVIEWS

RESEARCH APPROACH• Collaboration of FinTech Australia and EY

• FinTech Australia Census: comprehensive and focussed thought leadership research…

- Help define the industry

- Identify the challenges

- Cast a light on way forward

FinTech Australia Census

Wealth and investment

Lending

Data analytics / Big Data

Payments, wallets and supply chain

Asset management and trading

Regtech

Business tools

Marketplace-style / peer-to-peer solution

Identity, security and privacy

Blockchain/distributed ledger solution

Insurance/insurtech

Accelerator/venture capital

Crowdfunding/fractionalised investing

Challenger/neo bank

Digital/Crypto currencies /exchanges

Other

Retail consumers

Sophisticated investors

SME and/or other startups

Corporate

Banks and other FSIs

Government

Other

Business based

End customers (multiple response – excl. don’t know)

Age of company (excl. didn’t answer)

Company stage

54%

19%

1%

9%

12%

4%

0%

2%

NSW

VIC

TAS

SA

NT

QLD

WA

Overseas

Biggest competitors (excl. none)

45%

22%

35%

33%

43%

14%

15%

55%Net B2C

71%

Net B2B

Number of employees (median)

Type of fintech (multiple response)

5Full-time

2Part-time

30%

23%

18%

16%

11%

10%

10%

10%

6%

5%

5%

5%

5%

4%

4%

9%

36%Incumbents

29%Other fintechs

in Australia with a similar

offering

27%Overseas

fintechs with a similar offering

7%Other

20172016

57% 71%

43% 29%

Pre-revenue

Post-revenue

20172016

20% 31%

44%48%

36% 21%1 year or less

2 to 3 years

> 3 years

Net 2 yrs or more

79%

Fast facts: Sector profile 2017


Drivers of FinTech success

TALENT

POLICY

• Tax incentives

• Open banking

• New payments platform

• Licencing

• Regulatory sand boxes

Lack of experience/skillin Australia

Yes52%

No48%

ENVIRONMENT

DEMAND

• FinTech adoption continues to grow

• A more diverse profile

• Solution-centric

• Cost of acquisition and retention

CAPITAL


International Local

Outlook and optimism

COMPETITION

• 63% feel Australian FinTechs are internationally competitive

• 45% feel they will be able to win against international competitors

• Lack of quality FinTechs in Australia…?

34% agree

38% disagree

ADVANTAGE AUSTRALIA

Regulatory environment

Advanced financial services industry

Access to Asia


A global market

“I am delighted to see the increase in Australian fintech firms

that are setting global goals for their businesses. More than half

are now focused on expanding overseas in the next year.

Supporting these creative start-ups is a major focus of Austrade,

especially through our ‘Landing Pads’ program in five global

innovation hubs, which is already propelling many clever

Australian businesses to new heights.”

Stephanie Fahey, CEO Austrade

“The disruption of financial services is most likely to come

from digital giants from developing markets such as China

or even those technology giants from the US who are

extending their platform dominance into financial services.

In the face of this, many local fintech start-ups are likely to

be acquired by either global players or local incumbents and

should be preparing for that possibility by keeping in close

contact with potential acquirers.”

Simon Cant, Chair FinTech Australia

… of AseanFinTechs plan to expand beyond home or current markets

INTERNATIONAL EXPANSION PLANS

2016

38%2017

54%

87%

?

MELBOURNE

8 Exhibition StMelbourne VIC 3000 Australia GPO Box 67 Melbourne VIC 3001 T 61 3 9288 8651

SYDNEY

200 George StSydney NSW 2000 AustraliaGPO Box 2646 Sydney NSW 2001T 61 2 9248 5060

PERTH

11 Mounts Bay Rd Perth WA 6000 AustraliaGPO Box M939 Perth WA 6843T 61 8 9429 2222

CANBERRA

121 Marcus Clarke St Canberra ACT 2601 AustraliaGPO Box 281 Canberra ACT 2601T 61 2 6267 3888

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This communication provides general information which is current at the time of production. The

information contained in this communication does not constitute advice and should not be relied on

as such.

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Documents

Insights from the EY FinTech Adoption Index and EY FinTech … · 2018-05-21 · EY’s Global Fintech Adoption Index “Adoption: accepting or starting to use something new.” Cambridge,