Australia Outpaces US In FinTech Adoption, OnDeck Says
Australia’s adoption of alternative finance and FinTech is outpacing that of the U.S., according to OnDeck Capital Chief Executive Noah Breslow.
Reports in The Sydney Morning Herald on Wednesday (April 18) said the executive spoke at the AltFi Australiasia Summit event held in Sydney this week, declaring Australia to be the Asia-Pacific region’s second-largest market for alternative finance.
“We are looking at an industry that did $10 million of annual volume,” he said. “These numbers are from KPMG in 2013, and in 2016 that had grown to $220 million.”
Breslow said OnDeck’s own estimates of its performance in Australia suggest the company “could see around $700 million of annual volume just here in Australia” in 2018.
“You wind up with an industry that is much bigger and much more impactful than the industry we have today,” even if the Australian market delivered an 80 percent growth rate, continued Breslow. “So, we are estimating around 80 percent per year moving onto 2020, a potential $2 billion in annual loan originations just here in the Australian market.”
Following the event, Breslow told reporters that Australia has a “more concentrated banking system, which means there are fewer small business lending choices on the market. And that, in turn, means that alternative lenders like OnDeck have a bigger vacuum in some ways to fill.”
Long-term economic expansion in Australia, he continued, has also led small businesses to remain optimistic, again delivering an opportunity for alternative finance players.
OnDeck Australia Chief Executive Cameron Poolman told the publication that, despite Australia’s outpacing of the U.S. market, the two markets are similar.
“They have got very similar requirements for inventory or refurbishing their stores, quick access to be able to grow their business,” he said. “We are very, very similar there, which has been very helpful to be able to work with the U.S. and use their algorithms and their processes to build the business here.”
OnDeck first launched in Australia in 2015 following a partnership with accounting company MYOB.
Earlier this year, OnDeck reported a profitable Q4 2017 following several disappointing quarters in the U.S.