After launching less than six months ago, UK fintech company truRating is expanding into Australia with the hope of capitalising on the nation’s hot payments industry.
The startup, which offers a point-of-payment rating system, sees Australia’s payments sector as competitive but with just a few main players. Integration into existing terminals is one way it hopes to capture the market.
To date it has processed more than 400,000 ratings and the startup claims it is recording 40% week-on-week growth. While an Australian launch date has not been confirmed, the aim is early 2016.
“The Australian opportunity for truRating is huge and we are extremely excited about our prospects here,” truRating CEO and founder, Georgina Nelson, said.
“The Australian fintech community is ripe for innovation, providing an ideal environment for establishment and growth.”
This new system provides merchants a way to better understand a customer’s experience. Many retailers currently use comparison websites which can be easily gamed by non-customers (such as competitors or disgruntled ex-employees), online surveys which tend to elicit low response rates and mystery shopping exercises which can be costly.
The system rotates five questions to customers based around service, value, experience, atmosphere or product which they can rate between 0 and 9. It now works with every major payment company in the UK and the startup is working on agreements with Australian providers.
“Broadly the UK and Australia have similar approaches to payments, with an emphasis on card payments to pay for goods and services in both bricks and mortar locations and online,” Nelson said, adding the big difference between the two markets is the high number of contactless payments made in Australia.
truRating estimates contactless payments make up just over half of all transactions in Australia, compared to less than 30% in the UK.
“This is partly driven by the prevalence of contactless cards in circulation and terminals that read these, and the cultural focus on speed and ease in Australia, but mostly by the contactless transaction threshold sitting at $100 in Australia and only £20 in the UK (due to rise to £30 in September),” Nelson said.
The UK’s fintech sector is often heralded as one of the strongest in the world. Many fintech startups are jumping over to the UK to get in on the action. In December Australian bitcoin trading platform CoinJar reincorporated in the UK to take advantage of what it said was a more favourable taxation arrangement.
Just last month Chinese technology company Beijing Kunlun invested £22 million ($US34.2 million) in peer-to-peer mortgage lender LendInvest, the biggest Series A round in British fintech history.
It’s also receiving top-level government support from UK prime minister David Cameron. On a trade mission to South East Asia recently, Cameron threw his weight behind a new fintech manifesto from trade body Innovate Finance, published last week, and was holding a roundtable in Indonesia to coincide with the manifesto’s release. There’s more on that here.
The UK fintech space is well-established, pulsating with strong investment and innovation. Having some of that talent filter into Australia is good for local innovation.
“With truRating’s Head Office located right in the heart of the City of London, we have fully embraced this incubator environment and built strong relationships with global payment companies to integrate our technology, whilst also attracting significant private investment to fund our growth,” Nelson said.
Australia’s fintech market is still in its infancy, however, “there is a vibrant startup community (especially located out of Sydney) that is beginning to take shape,” Nelson said.
Fintech co-working space Stone & Chalk managed to secure Alex Scandurra to lead the initiative, which will be run out of 50 Bridge Street in Sydney. Scandurra formerly led Barclay’s accelerator program in the UK.
Just last week NAB announced it would launch a $50 million fintech innovation fund. Westpac, through Reinventure also has a $50 million fund and Commbank runs a huge innovation lab at its Sydney headquarters.