Speaking as part of a panel on the FSC Leaders Summit on Tuesday, ASX Limited Equity Post Trade Services general manager Cliff Richards said that due to the volume of fintech companies, large financial institutions are simply unable to invest in most apart from a select few.
“We’ve looked at hundreds and hundreds of fintechs across three areas of the last two years,” Mr Richards said.
“There’s a spectrum of maturity of fintechs. And there are brilliant people at every layer but we can’t afford to invest significant amounts of capital and precious time in organisations that we would have to devote so much effort to getting them up that maturity level.
“So this universe of 100 per cent of fintechs is quickly narrowed to 1 or 2 per cent.”
While larger institutions were mobilised to work with fintechs and start-ups in the face of “existential threat”, Mr Richards said the more competition between start-ups, the better.
“I actually don’t want it to be too easy for fintechs,” Mr Richards said.
“I want the cream to rise to the top. I want smart, hardworking people. You want to see that struggle and fight, the same that you want to see it in the other end of town.
“You want that competitive tension amongst the providers.”
The panel was chaired by RBC Investor & Treasury Services managing director David Travers and other members of the panel included Fintech Australia chief executive Danielle Szetho, CSIRO’s Data 61 business development manager Tom Durick, and The Fold Legal managing director Claire Wivell Plater.
The panel discussed structural challenges to the fintech and financial services industry as well as emerging technology such as blockchain and regtech.