Australian businesses are missing the opportunity and benefits of fintech, according to a new report from Airwallex and CPA Australia.
In August 2020, Airwallex and CPA Australia surveyed 600 CPA members working in finance and accounting across organisations in Asia Pacific (APAC) to evaluate the current state of fintech adoption.
The report aims to address barriers to fintech adoption and help businesses understand the benefits of fintech solutions in modernising their business operations.
Despite increasing digital adoption in response to the COVID-19 pandemic, the survey revealed that only a third of businesses in APAC have actively adopted fintech solutions.
Additionally, a majority of businesses continue to have unmet business banking needs.
According to the survey, businesses across APAC cited high banking fees (48%), slow and manual service delivery (35%) and the inability to set up global bank accounts (29%) as the top pain points.
Cybersecurity concerns top the list of reasons why businesses are yet to apply fintech solutions, with more than half (53%) stating this is a key barrier for adopting tech solutions to manage their financial needs.
This was closely followed by data privacy concerns (48%), and reliability and trust (48%).
The survey also found 70% of APAC businesses have not used any fintech solutions, and 40% of APAC businesses are unaware of fintech and the benefits it offers.
High banking fees (48%), slow and manual service delivery (35%) and inability to set up global bank accounts (29%) were cited as the top unmet needs by businesses.
On top of this, 48% of respondents surveyed expressed cybersecurity, data privacy and trust concerns.
Overall, Australia is leading APAC in familiarity and awareness of fintech benefits.
According to the survey, 61% of Australian CPA members surveyed having familiarity with the fintech options available for SME and enterprises (as compared with Hong Kong at 57%, Malaysia at 56% and Singapore at 54%).
In addition, Australia is leading APAC in fintech usage.
39% of Australian-based CPA members surveyed have used at least one or more fintech (as compared with Hong Kong at 36%, Singapore at 28% and Malaysia at 20%).
Airwallex VP global head of SME Neil Luo says, “Fintech has transformed the global economy, creating new revenue streams and operating efficiencies so businesses large and small can remain viable in an increasingly competitive environment.
"However, today's data shows low fintech adoption rates, highlighting a huge missed opportunity for businesses across the region in realising the benefits fintech has to offer.
"Many of the key business pain points - including opening accounts overseas, being charged high FX fees on foreign transactions and inability to issue employees with their own cards - can be alleviated or resolved through fintechs such as Airwallex."
"We understand education is key to greater fintech adoption, and look forward to working alongside CPA Australia in supporting accountants and the businesses they serve," Luo says.
CPA Australia manager of business and investment policy, and Asia policy lead, Gavan Ord says, “Australian businesses are falling behind their international counterparts when it comes to the uptake of fintech solutions.
"The current business environment amid the COVID-19 pandemic has made digital technologies more essential than ever before. Many of our members support clients who need help transforming into digital-first businesses.
"CPA Australia supports initiatives that encourage small businesses to undertake digital transformation. With the right technology, businesses can improve their agility in this highly competitive environment."