Asia-Pacific Alternative Finance Report

Asia-Pacific Alternative Finance Report

KPMG has released the Asia-Pacific Alternative Finance Benchmarking Report, encompassing 500 platforms in the Asia-Pacific region – and it’s good news for Equitise. The report underscores the nascent popularity and potential of equity crowdfunding in the ASEAN area, with the Australian market in particular developing rapidly.

The key details

The rapid growth and reach of the alternative finance industry is spelled out in the report’s figures – US$101.7 billion in online alternative finance transactions registering in China over 2015 alone. 2015 also marked a banner year for Australia, with the market growing over 320% to US$348 million. Australia is the third largest market in the region, indicating its abundant potential.

New Zealand's position

The Report’s outline of the New Zealand market in 2015 also informs our assessment of these Australian figures. As one of the smallest countries in the Report, New Zealand nonetheless has a large industry on a per capita basis, and with growth of 1117%, is one of the fastest growing markets in the region. If equity crowdfunding platforms had the capacity to mirror this success in a newly-regulated Australian market, the growth would be stratospheric.

Australia's regulation still lagging

Unfortunately, as the Report also states, such regulation is still sorely lacking. According to the report, 30% surveyed viewed the proposed regulations as too restrictive and excessive. Only 48% considered them adequate and appropriate. Until platforms in Australia are able to operate under a similar framework as exists in New Zealand or Malaysia, the Australian market’s potential cannot be harnessed. Equitise has delivered submissions to the Australian government in that regard. The Report, too, acknowledges that in New Zealand the “national regulators have taken a more proactive stance by formulating bespoke regulation to accommodate alternative finance activity”. The same is not said of Australia. The ratio of total funding in New Zealand is approximately 5 times that of Australia, which, according to the Report, demonstrates the level of market penetration in New Zealand. Once the Australian market has been fully harnessed, these figures can be expected to change.

How is Equitise positioned?

As the first trans-Tasman equity crowdfunding platform, Equitise seeks to encourage an innovative and competitive regulatory framework that balances financial innovation alongside consumer interests. When this has been achieved, Equitise can assist in the expansion of Australia’s $348 million alternative finance market. As the alternative finance market continues to expand across these territories, Equitise will be able to offer Australia and New Zealand-wide offers. Equitise will broaden investment opportunities across the untapped potential of the Australian market, and increase the investor pool for Asia-Pacific companies. Since inception, Equitise has been a though-leader in the industry, providing market commentary and advising on the proposed Australian regulatory framework. This has given us a unique position in the industry and firsthand understanding of its impact and reach. This knowledge, coupled with a track record of trust and confidence from New Zealand transactions, demonstrates its capacity as the leading equity crowdfunding platform in the region.

With institutional investment arriving, such as that from Investec, Equitise is ready to shake up the alternative finance market in Australia and beyond in 2016.

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