Two more venture capital deals have been announced between major Australian banks and fintech startups this week — part of a broader trend as banks seek more deals in the space.
NAB’s venture capital arm NAB Ventures has partnered with property investment startup BrickX, following an investment by ANZ in data-security company Data Republic.
The NAB investment forms part of a $9 million Series A funding round for BrickX, which offers investors exposure to Australian property via a fractional ownership model.
“NAB’s investment will allow BRICKX to accelerate the company’s growth plans, bringing more properties to the BRICKX platform, and helping more Australians get their foot onto the property ladder,” BrickX CEO Anthony Millet told Business Insider.
“Housing affordability and accessibility is increasingly challenging for many Australians, and BRICKX and NAB are aligned in improving the path to home ownership.”
NAB’s announcement this morning follows a similar investment in BrickX last November by Westpac’s venture capital arm, as the big banks seek new ways to remain competitive in an environment of low housing affordability.
“Building trust and credibility is especially hard in the fintech sector, we’re thrilled to have support from the venture capital arms of NAB and Westpac,” Millet said.
“Such high profile investors will give existing and new investors increased comfort in using a less traditional and innovative business.”
ANZ’s partnership with Data Republic will see the bank start using the platform to share data securely, both internally and with third parties.
The deal included the purchase of a stake in Data Republic which is understood to be around $2 million, according to reports in the AFR.
“This partnership is about ANZ investing in the right technology to future-proof their data collaboration capabilities and will ultimately position ANZ to overcome many of the challenges and potential risks associated with open data, data sharing and the Federal Government’s recently announced Open Banking reforms,” said Data Republic CEO Paul McCarney.
The federal government recently announced draft legislation on Open Banking — which are expected to increase competition in the sector and increase the choice of product offerings for consumers.
Earlier this month, Westpac doubled its investment in online mortgage-broker Uno Home Loans — part of a strategic push to take a bigger cut of the mortgage-broking revenue pie.
The additional $25 million investment takes Westpac’s ownership stake in Uno to 81%.
The latest deal announcements are unlikely to be the last for Australia’s fintech sector.
Ernst & Young’s 2018 Global Banking Outlook showed that Australians have the fifth highest rate of fintech adoption in the world, with 80% of Australian banks looking to set up new partnerships and investments over the coming year.