The Australia Treasury and the Monetary Authority of Singapore (MAS) have signed an Australia-Singapore FinTech Bridge Agreement to strengthen cooperation between the fintech ecosystems of both countries.
This follows a recent announcement that FinTech Australia has signed up seven new major corporate partners, including tech giant Oracle. The country’s ecosystem partnership programme helps companies collaborate with the fintech sector and foster key relationships with its key players.
The rise and rise of Australian fintech
Australia and Singapore are world leaders in fintech, consistently ranking in the top 10 of global rankings, with Singapore and Australia fourth and sixth globally and first and second in Asia-Pacific, according to Findexable’s 2021 Global Fintech Rankings.
Both countries offer a stable regulatory environment, with politics that encourage innovation whilst maintaining market stability, resulting in vibrant fintech cultures.
Australia has one of the most sophisticated fintech industries growing from a A$250m industry in 2015 to a A$4bn industry in 2021, according to Australian Fintech.
It has experienced significant growth in recent years, with a five-fold increase in the number of fintech companies from just five years ago, and a particular surge in demand in 2020. Fintechs raised record capital during the pandemic, with at least five years of fintech growth condensed into six months according to Simone Joyce, Chairperson of FinTech Australia. The country now has more than 800 fintech firms.
Meanwhile, the Singapore fintech ecosystem, ranked top in Asia-Pacific, has grown exponentially in a short span of time, and is now home to more than 1,400 fintechs offering a wide range of solutions, as well as more than 40 innovation labs. While equity funding for Singapore fintechs has grown to a five-year high of US$3.9bn in 2021.
With a growing number of businesses and capital seeking opportunity in both countries, now is the perfect time to grow the relationship via a fintech bridge.
How the FinTech Bridge will aid both countries
Building on the overarching framework for digital economy cooperation under the 2020 Australia-Singapore Digital Economy Agreement (DEA) to deepen collaboration between the fintech ecosystems of both countries, the new Australia-Singapore FinTech Bridge Agreement sets out a framework for both authorities to deepen bilateral collaborations as follows:
- To facilitate trade, investment and ecosystem development in the fintech sector
- To support the mutual establishment of fintechs looking to expand in each other’s markets, and to encourage fintechs to use the facilities and assistance available to explore new business opportunities and reduce barriers to entry
- To build on current engagements to strengthen linkages between Australia and Singapore for policy officials, regulators, and industry groups; and to work together to share fintech expertise and encourage the development of new opportunities
- To explore joint innovation projects on emerging issues in fintech to help the industry navigate through a constantly evolving space, to share information on emerging market trends, and to learn from the experiences in each jurisdiction. This includes collaboration in areas such as blockchain and distributed ledger technology, digital identities, cross-border data connectivity, data portability, and the application of fintech to promote sustainable finance.
It is designed to strengthen cooperation and collaboration on emerging issues on fintech policy and regulation, and will support fintech companies looking to expand in each other’s markets, and encourage them to use the facilities and assistance available to explore new business opportunities and reduce barriers to entry.