As a banking team that specialises in technology industries, it’s a privilege, and at times a challenge, to work at the leading edge. This is especially true in the fast-evolving and fast-growing subsectors of FinTech and PayTech.
According to The Technology Investment Network (TIN) 2022 FinTech Investment Report, the FinTech and PayTech sectors combined generate $1.8B in annual revenue. And with a high rate of growth (24.4% p.a.), these unique subsectors outpace any other subsectors of tech businesses, more than doubling the average growth rate of the overall tech industry of 11.5% p.a.
These subsectors not only operate in a complex environment of regulation, data, security, and long-established incumbents but they are also, in some cases, offering an alternative to some of our core propositions as a bank.
The combination of risk, security, trust, ESG, regulatory challenges, multi-faceted relationships with banks and potentially competing interests might present a list of reasons why not to invest time, energy and resources. We’re taking the opposite approach. We’re leaning right in. In fact, we have invested in two significant leadership roles to support the continued growth of both the PayTech and FinTech subsectors for New Zealand and for BNZ, Sorel Carr as our Head of FinTech business and Joe Rastrick as our Head of PayTech & Emerging Payments.
This is part of our investment in leadership within New Zealand’s technology industries (see also Watch these spaces, BNZ triples down on tech sector)
These subsectors are important to us, to our customers, and to New Zealanders, for a number of reasons, starting with how we do our best work.
True customer-centricity is thinking outside the bank
In this context, one thing every customer has in common is their desire for an effective approach tailored to their business. Our solutions at BNZ might be the best option to deliver to our customers’ needs, or they might not (in isolation). The best solution may be partially what we have and partially something else. The only way we can support our customers with the right solution is by having intimate knowledge of their business and of the solutions from FinTech and PayTech businesses (also our customers in many cases). Staying close to the FinTech and PayTech ecosystem is an opportunity in and of itself. This keeps us right up to date with innovation in our industry.
The more we know, the more we can support our customers to grow
Our desire for a deep knowledge of the market has led to relationships with a wide range of emerging and established FinTech and PayTech sector leaders. In short, we’ve been sticking close to these sectors for a long time, and yet it’s clear we’re just getting started. The FinTech and PayTech sectors are set for growth, but the tail winds are many, including regulation, customer demand, technologies available, and market innovation.
We see the opportunities for the FinTech and PayTech industry, and for BNZ. New Zealand is on the cusp of major ecosystem changes that embrace data transparency, digital currency, and an increased emphasis on equitable access, to name a few underlying trends. All this means that the doors are being thrown wide open for a raft of innovation to meet evolving wants, needs and preferences of our customers. We expect to see a significant number of businesses emerge with new Fintech and PayTech solutions in the near to medium term.
What does success look like?
In a nutshell, the FinTech and PayTech businesses who will succeed, will be those who have a solution that consumers say is materially better that what’s already on offer in a mature market. They will also be the ones who can build trust, volume, margin and scale – fast. On top of that, they will need to meet regulatory requirements, have leading edge security and in many cases partner successfully with incumbents in the industry (such as us). That’s a tall order, but it’s already proven possible, and we’re seeing an increasing number of exciting business models and solutions in this space.
I began by saying it’s a privilege and a challenge to work at the leading edge of these sectors, and I wouldn’t have it any other way. All of the hurdles that we have overcome stack up to a depth of knowledge that makes us very useful to our customers, both broadly speaking and specifically in this space.
We’re keen to help, we offer an interesting observation point across the technology industries, and from having been in the industry ourselves for a while. We’re more than happy to share insights, observations and more with businesses looking to break ground with FinTech and PayTech innovation. I warmly invite anyone in the sector to contact myself, Joe Rastrick, Sorel Carr and the wider BNZ team to explore how we can support more financial innovation to thrive in, and from, New Zealand.
Any views expressed in this article are the personal views of Tim Wixon do not necessarily represent the views of BNZ, or its related entities. This article is solely for information purposes and is not intended to be financial advice. If you need help, please contact BNZ or your financial adviser. Neither BNZ nor any person involved in this article accepts any liability for any direct or indirect loss or damage arising out of the use of, or reliance on, all or any part of the content.