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Fintech Numbers Fall for First Time – KPMG

Australia
Uncategorized
FinTech

(7 November 2023 – Australia) The total number of Australian fintech startups declined for the first time on record according to KPMG.

The fintech sector is  marked by ongoing challenges relating to more restricted capital acquisition circumstances and extensive revaluations. The total number of fintechs fell by three percent to 830 companies amid persistent economic growth concerns and the Reserve Bank of Australia’s (RBA) hawkish monetary policy. 

“In a tough operating environment, Australia’s fintech sector has had to grow up. The overall more challenging economic market conditions in 2023, coupled with a material shift in investor sentiment, have led to subdued market activity, hindered also by the high rates environment and inflationary pressures” stated KPMG Australia Head of Fintech and Partner, M&A, Daniel Teper. 

“Investors are more cautious and are prioritising safer investments over higher risk growth investment opportunities. These prevailing market conditions have ultimately forced the fintech sector to consolidate, with ventures having to re-evaluate their risk profile and appetite for growth over profitability.” 

“Looking ahead, it is reasonable to assume that a few of the above-mentioned negative catalysts will ease their pressure on the market, and investors will once again turn their attention to growth investments in the sector and allowing fintechs to refocus their attention on innovation and expansive growth.” 

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