The majority (78%) of fintech in Australia is now revenue-generating, up from 70% in 2021, according to the most recent EY FinTech Australia National census, but founders anticipate substantial obstacles in 2023.
As Australia’s Fintech Pay Trends industry expands rapidly, the payments sector still has plenty of room for growth. The growth of digital wallets, digital gifting, and innovative payment solutions cannot be overstated when it comes to digital payment solutions.
As early as 2025, digital wallets are predicted to replace cash as the primary method of payment in Australia. Digital wallets are predicted to outperform both methods by 2025, a development exacerbated by the shift in customer behavior brought on by the Covid-19 outbreak.
Digital wallets and gift cards are becoming a popular option for individuals to share thoughtful experiences on a budget as the pandemic limits life events and an uncertain global economy continue to squeeze buying power.
Karta gift cards use Mastercard and Visa technology. Scheme-based technology eliminates merchant integration. Unlike open-loop debit cards, cards are merchant-specific. We envisage digital wallets allowing five-fold growth rates employing technologies like Karta gift cards. Currently, 3-5% of gift card volume comes from merchants.
Protection of Costumer’s Data
“Physical gift cards still outnumber digital ones, although digital has grown rapidly since COVID-19. Anderson says industry reports show a 20%+ YoY increase.
Trust in these underutilized payment methods depends on consumer data privacy.
We expect that as datasets rise, customer interest in Consumer Data Rights (CDR) will grow. “In Australia, while the immediate focus was on financial data, the CDR was envisioned to be gradually expanded economy-wide,” says Fintech Australia policy head Nick Kavass.
Prospective Path of Future Expansion
It is a favorable environment for the growth of innovative fintech, which is fueling the transition to a cashless society. This is due to Australia’s favorable regulatory environment, wide pool of technology and financial services talent in larger cities, as well as a still under-addressed market for flexible financial solutions. This expansion
Continued industry collaboration will be essential to this expansion, as well as cross-industry cooperation, ongoing regulatory dialogue, consumer-focused data protection measures, and education.
Regulatory Assistance
It is crucial to the continuous expansion of the payments industry that the regulatory environment be one that encourages innovation in payment systems. This includes the construction of a new regulatory framework in order to facilitate the implementation of an open banking regime, as well as the expansion of the regulatory sandbox (ERS). The preceding version, which was referred to as the Financial Regulatory Sandbox, was superseded by the ERS when it was placed into action by the Australian government in September of 2020.
The four major Australian banks were required to transmit banking data to TPPs by June 2019 as part of the new legal framework.
The Open Banking Tracker lists 29 Australian banks and account providers, 33 APIs, and 17 API aggregators. Australia’s regulatory environment includes challenger enterprises, unlike in other OECD economies, where state-level legislation has focused on incumbent financial corporations and incentivized smaller fintech to catch up.
FinTech Australia has maintained their support for Open Banking throughout Australia. Open Banking was made easier to use by the government a year ago. According to Kavass, the new certification paths enhanced the amount of participation and access to the regime.
Conclusion
The world of payments is going through tremendous changes, from BNPL to bitcoin, and the innovation that is taking place in the financial technology sector is at the center of this process.
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