Small and medium-sized Enterprises (SME) are important not only to Australia’s economy but also to the whole world. 80 percent of economic activity in the world is made by these SMEs. An entry in The FinTech Book by Luke Hally, CEO & Founder of DragonBill, said that SMEs are a “critical part” of the economy, making up 97 percent of businesses and employing 47 percent of the workforce.
According to Lend, more than half of the total 2,066,523 Australian small businesses have loans in some descriptions and only 30 percent are debt-free. The majority of small businesses have a turnover of less than $200,000 per year.
Ever since the Global Financial Crisis from 2007 to 2008, lending companies have become wary and less willing to lend money to startups, small businesses, and entrepreneurs. Even though there is a situation like this, learning to adapt an agile finance strategy can help these types of businesses. Smaller teams will be created to meet up frequently to create a small group of authority to lessen the process of making decisions. To get an agile finance for small businesses, one can use financial technology or also known as FinTech.
FinTech is defined by the World Economic Forum as the use of technology and innovative business models in financial services. From 2013 to 2014, equity investment in FinTech companies has skyrocketed from $4 billion to more than $12 billion.
Moreover, FinTech is making funding more accessible to the needs of SMEs and startups. Their solutions offer marketplace lending, merchant and e-commerce finance, invoice finance, supply chain finance, and trade finance. These solutions help the business grow, have more efficiency and improve customer service.
“Realising our FinTech potential will transform our economy, not just in the ?nancial services sector, but by providing the tools our economy needs to continue our successful transition from the mining investment boom to a more diversi?ed economy. This is how we can deliver higher real wages and improved living standards for all Australians,” Treasurer of Australia Scott Morrison MP said in the inaugural FinTech Australia Summit this month.
“That is why development of FinTech is a key component of our national plan for jobs and why we are committed to ?nancial technology and are excited about what you are doing and trying to achieve.”
Morrison also said that they are going to provide $200,000 to FinTech Australia “to promote Australia internationally as a FinTech destination.”
There are many benefits of FinTech that can help SMEs and startups grow as a company and to achieve their goal and profit. With the benefits from growth to better customer experience, Business brokers Victoria will have an advantage in how to grow, maintain a business and have more sales.