Chris Brycki is the founder and CEO of Stockspot. This year he was appointed to the ASIC Digital Advisory Committee, which consists of members from across fintech and government.
Fintech has the power “to create competition, innovation and jobs,” according to Chris Brycki.
And has the potential to have a huge impact on the Australian economy, “and worth being involved in”.
Brycki recently attened his first Digital Advisory Committee meeting, where he heard from fintechs, government and consumer advocacy groups.
Here’s what he took away from the meeting, and says are the top three ingredients to drive Australian fintech forward in 2017.
I was appointed to the ASIC Digital Advisory Committee recently. The Committee consists of members from across fintech and government. True-to-nature I attended my first meeting eager to contribute! The potential of fintech to create competition, innovation and jobs for a 21st century Australian economy is huge and worth being involved in.
After hearing the views of many fintechs, government and consumer advocacy groups, here’s my top three ingredients to drive Australian fintech forward in 2017.
The New Payments Platform (NPP) will help real-time payments between financial institutions and customers’ accounts via mobile devices. This technology will have an even greater impact than ATMs and POS systems had on how we access, use and transfer money. I don’t think many people realise how profoundly super-fast, data-rich, immediate payments could change how people bank, shop and run their financial lives.
Our friends at the major banks have dragged their feet on NPP. It’s been delayed and the banks are nervous that it will increase fintech competition.
For many fintechs it will be the definitive step change in the customer experience. It takes up to three days for our clients to deposit funds into their investment accounts. Under NPP it will be almost instant. No more waiting several nervous days while money is in limbo.
NPP could drive a huge amount of innovation and new businesses will be created off the back of instant payments. NPP is currently due late 2017.
It’s MY data!
I cannot emphasise enough the importance of open-data to our fintech future. It starts with consumers having control over who can access their data and on what terms.
Personal control of our own data opens worlds of possibilities, including sharing it with trusted parties of your choice who can provide a better service and more relevant advice.
For Stockspot we could provide more nuanced investment advice. Other fintechs could give better and more affordable insurance or budgeting based on personal saving habits.
Naturally, the banks are nervous because open data means more competition and more transparency around fees, interest and returns.
Open data will empower consumers to make better financial decisions, something that is well overdue.
The Big Banks came out strongly to demand security and privacy standards be set first. Like Fintech Australia, I agree with this stance – but it should be done within a reasonable time.
Consumer education (and how to spot faux fintech)
A risk of fintech (a topic not often discussed) is how technology makes financial services more accessible. Better access can make it more difficult for consumers to discriminate between products that are helpful versus those that are potentially harmful and very costly.
It’s the job of ASIC, consumer groups like CHOICE and members of the fintech ecosystem to help educate consumers about what to look out for.
For example, some technology enabled lending products charge frighteningly high interest rates for ‘payday’ style loans. Last year Nimble was ordered to refund $1.5m to over 7,000 consumers for breaching responsible lending laws.
One fintech super fund with flashy marketing aimed at millennials has fees of over 1.5% per year and no life insurance option is another case of this. The efficiencies of fintech should give consumers access to lower cost super and more insurance options, not the other way around!
Our Fat Cat Funds Report shows a super fund charging 1.5% p.a in fees has almost zero chance of delivering superior performance over the long run.
The ease of accessing fintech products and services means it’s vitally important consumers are educated about what to look out for in financial products. No amount of ‘fintech’ marketing can turn a poor value financial product into something that’s in the best interest of consumers.
Chris Brycki is the founder and CEO of Stockspot.
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