New Zealand FinTech-New Zealand is a country that can be easy to overlook when it comes to FinTech. But the story of how payments are evolving there can offer lessons for the rest of the globe, along with glimpses of how the relevant technology might play out in the 2020s.
And that’s why PYMNTS recently caught up with Steve Wiggins, the chief executive of payment governance organization Payments NZ, and Serge van Dam, a venture capitalist focused on FinTech in that country, to get a better idea of what’s going on there – and why it matters to the rest of the FinTech world.
These are indeed exciting times for FinTech, payments and financial services in New Zealand. Open Banking stands as one recent example. Earlier this year, for instance, Payments NZ launched the first application programming interface (API) standards tied to account data and payment initiations. The move comes after a pilot launched last year involving several stakeholders in the industry, spanning Datacom, BNZ, Westpac and others. The overarching approach has been to bring API standards to bear so that financial firms can speed the time it takes to bring new products and services to market.
“Open Banking will create the infrastructure for innovation,” van Dam said.
Thanks to such fuel, the FinTech sector in New Zealand has grown some 33 percent year over year, Wiggins told PYMNTS, with more growth certain to come. After all, as van Dam noted, even though New Zealand may be small – about 5 million people live there – the country has a developed consumer market made up of relatively highly educated people who speak English. All of those factors combine to make FinTech a robust proposition in that country.
“The smaller the network, the faster you can actually get to mass market – and to success, really,” said van Dam.
Challenges abound, of course, just as they do in any market. For New Zealand FinTech, the problem is how to scale. In that case, size does tend to inhibit growth. “The inability to scale is one of the key competitive disadvantages,” Wiggins told PYMNTS.
Other differences also stand out for the country’s FinTech scene – differences that seem likely to, at the least, produce case studies in the near future about the relationships being created in the FinTech and financial services world to create more innovation around products and services.