(pictured: Ian Dunbar)
Small companies offering innovative fintech solutions find it very difficult dealing with big super funds, according to Ian Dunbar, Afiniation co-founder and SuiteBox Australia chief executive.
He told a fintech conference organised by FIS, the global banking and payments technology company which last year acquired SunGard, in Sydney last week that small companies “just won’t deal with super funds because it’s just too hard”.
Dunbar said: “It’s sad because super funds could do with some innovation, but they are too unwieldy. They require you to go to Melbourne for meetings and they get you to fill in 500-question questionnaires.”
He should know, too. Prior to getting into the fintech space with his consulting firm FinDigital in 2014, Dunbar headed up the introduction of member direct investment option platforms at UBS, which has several big super fund clients including AustralianSuper, QSuper and Telstra Super.
He said Australia had a tiny share of the fintech market in the region, which was dominated by China and India. There were about 400 fintech companies in Australia, he said. Last year US$22 billion was invested in fintech globally, including US$14.8 billion in the US and US$4.3 billion in the Asia Pacific region, mostly in China and India. Australia had about A$150 million invested.
Afiniation is a group which aims to foster collaboration between fintech companies and promote their message to a wider audience, particularly investors.
Dunbar told the conference, called Fintech 2020 – part of a series of events being held around the world – that the concentrated nature of the Australian financial services market was a challenge for innovation, although you did not have a to be a startup to be innovative, he said.
Another problem was the high costs associated with resourcing fintech, and a shortage of talent. Australia needed to invest more in education and to foster more immigration to improve the talent pool.
It also needed to address its tax system and the treatment of equity incentives, which required income tax to be paid at a time when startup founders had little cashflow. Given a choice, your would be mad to build a development centre in Australia, he said.
SuiteBox is a New Zealand-based startup which offers subscribers, such as financial planning firms, virtual meeting rooms for client interaction.