澳大利亚全球监管科技枢纽蓄势待发：关于支持当地监管科技扩大规模的观点（英文版）.pdf

Australias global RegTech hub poised for growth A perspective on supporting the local RegTech sector to scale XBoston Consulting Group partners with leaders in business and society to tackle their most important challenges and capture their greatest opportunities. BCGs diverse, global teams bring deep industry and functional expertise and a range of perspectives to spark change through leading-edge management consulting as well as data science, technology and design, digital ventures, and business purpose. We work in a uniquely collaborative model across the firm and throughout all levels of the client organisation to deliver results that help our clients thrive. Boston Consulting Group BCG Expand FinTech Control Tower (FCT) is a research focused unit developed jointly by the Boston Consulting Group (BCG) and Expand Research. The FCT identifies initiatives, technologies, and companies that matter most in todays FinTech ecosystem and assess their impact. This is completed using our internal platform that can ingest data from multiple sources and apply a proprietary taxonomy combined with a rigorous framework, resulting in a highly accurate and globally complete FinTech dataset. We engage directly with financial institutions, regulators, industry stakeholders and innovators, putting us at the forefront of the latest research and FinTech trends. BCG Expand FinTech Control Tower The RegTech Association was founded in 2017 in Australia as a non-profit organisation that focuses on what is needed to support the growth of the global sector and to accelerate RegTech adoption across all regulated industry verticals. Our vision is to be a global centre of excellence by facilitating the building of higher performing, ethical and compliant businesses through RegTech innovation and investment. The RegTech Association 2This report has been developed in partnership with BCG Expand FinTech Control Tower, a subsidiary of the Boston Consulting Group, and The RegTech Association. It draws on findings from BCG Expands FinTech Control Tower global report into the RegTech landscape, which has considered: About this report The Australian edition of this report, Australias global RegTech hub poised for growth, applies a local lens to the RegTech sector. It is informed by interviews with local RegTech executives, a survey of The RegTech Association members, and perspectives from The RegTech Association, the peak industry body headquartered in Australia. A taxonomy of RegTech segments. Global growth trends in RegTech and related equity funding. RegTechs responses to COVID-19 and how they continue to adapt to support regulators, businesses and consumers. 3Summary RegTech, short for Regulatory Technology, is the application of emerging technology to improve the way businesses manage regulatory compliance. Australias RegTech sector is the third largest in the world behind the US and the UK. However, this strong position is under threat as investment in local RegTech has declined by 50% since 2018 while RegTech investment around the world has hit record levels. Today, only 1% of the global investment in RegTech is in Australian companies. There are opportunities for both the public and private sectors to support Australias RegTechs by jointly driving demand for RegTech solutions, creating new funding pools, enhancing regulatory frameworks to support innovation, and promoting RegTech to build the industrys profile and talent pipeline. This support would help local RegTechs to scale, creating jobs, supporting the export of Australian solutions into overseas markets, and improving the efficiency and effectiveness of regulatory compliance and oversight to benefit consumers, companies and regulators. Source: BCG FinTech Control TowerRegTech Taxonomy 7 Clusters 16 Sub-Categories Risk Analysis Policy Management Training and Awareness Regulatory Analysis Implemen- tation funding levels significantly lower than the top 5 nations 1.98 (33%) 3.87 (65%) 755 0.15 (3%) 1. RegTechs categorised by HQ location 2. Cumulative total as of end 2020 H1 Source: BCG FinTech Control Tower 7Investment lags innovation Funding for RegTechs has reached record highs around the world in the past five years, driven by a sharp increase in US$100+ million mega rounds, that indicate a maturing market for RegTech capital investment. Australia, however, has gone against the trend. Australias fall in RegTech funding (Exhibit 4) is in line with Australian investment in innovation overall. In 2020, Australia was ranked #23 on the Global Innovation Index, down from #20 in 2018 2 . As a result, growth and innovation in Australias RegTech industry has outstripped funding. The local market is small, typically risk averse, and often lacks an understanding of RegTech solutions. Low levels of local funding opportunities risk leaving Australias RegTech companies at a disadvantage. Case study: Global RegTech funding mega rounds The last two years have seen examples of RegTech players being funded through mega-rounds, where total funding exceeds US$100 million. These funding rounds often attract multiple types of investors, including venture capital, private equity funds and banks. Examples of these funding rounds are highlighted below. Verafin, a Canadian RegTech established in 2003 focusing on financial crime management, received US$388 million in September 2019 from Scotiabank, Spectrum Equity, Northleaf Capital Partners and Information Venture Partners. OneTrust, a US based RegTech specialising in data compliance management, received US$410 million across two funding rounds in 2019 and 2020, from Coatue Management and Insight Partners. BioCatch, an Israeli RegTech that provides behavioural biometrics solutions, received US$145 million in April 2020 from several firms including American Express, Bain Capital, CreditEase and OurCrowd. 2 Cornell University, INSEAD, and WIPO (2020) The Global Innovation Index 2020: Who Will Finance Innovation?, Ithaca, Fontainebleau, and Geneva. Cornell University, INSEAD, and WIPO (2018) The Global Innovation Index 2018: Energizing the World with Innovation, Ithaca, Fontainebleau, and Geneva. 8Exhibit 4 | Since 2008, global RegTech equity funding has drastically outpaced funding for Australian firms Equity funding by year for RegTechs globally (USD $M) Equity funding by year for Australian RegTechs (USD $M) Note: Different scale to global funding chart RegTech founders are typically industry practitioners experienced in compliance and regulation, confident that technology can provide a better way to do things. The RegTech Association research indicates that 71% of member organisations consider themselves beyond early stage organisations, extending into the small-medium enterprise stage. Despite this, the funding mix in Australia skews towards early stage seed and angel investments. This contrasts with trends globally, where the funding mix is more balanced across early stage funding and subsequent series A to D (Exhibit 5). Interviews with RegTech founders suggest that one challenge to local funding is the lengthy sales cycle; it can often take up to two years to sell a software-as-a- service solution into a major Australian corporate. These timelines can put off second round investors who typically look at revenues as driver of their investment decision. Australian RegTechs say that reduced access to subsequent equity funding rounds can constrain product innovation and their ability to scale. Some turn to opportunities in international markets where they can attract foreign capital and, perversely, increase their attractiveness to Australian customers because many local companies place greater trust in solutions that have been tested in other markets, despite Australias reputation as a global RegTech hub. Australian RegTechs hope that the consumer trend towards buying local 3 amplified by COVID-19 will extend to their software-as-a-service solutions. 3 Boston Consulting Group (2020), Australian Consumer Sentiment Snapshot series. Between 2018 and 2019, RegTechs globally experienced an 80% growth in annual funding In the same period, Australian RegTechs experienced a 50% decline in funding Source: BCG FinTech Control Tower Data Compliance Management 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Implementation BCG FinTech Control Tower Nonetheless, Australian RegTechs remain positive about future growth and continue to seek growth capital to fund product development, talent acquisition and market expansion. On balance, COVID-19 should support the continued growth in RegTech. The pandemic has accelerated a shift towards remote working and digital interactions, which in turn increases cybersecurity, fraud and financial crime risks. There is a growing focus within Federal and State Governments on RegTech in terms of its potential to efficiently and effectively solve regulatory and compliance challenges, and to be a signature export for Australia. This, combined with regulatory pressure for all regulated entities across a range of industries to adopt Reg Tech, will create a strong platform for RegTechs to excel. A slowing of export opportunities for almost a third of the companies surveyed, as a result of travel restrictions and the postponement of trade events. The disruption to regular business operations and procurement processes of existing and potential RegTech clients. COVID-19s impact on Australia RegTechs Business Operation Fund Raising Revenue Highly Negative Negative No Impact Positive Highly Positive Highly Negative Negative No Impact Positive Highly Positive Highly Negative Negative No Impact Positive Highly Positive 7% 20% 53% 13% 7% 7% 13% 60% 7% 13% 20% 47% 7% 13% 13% 45% 25% 16% 50% 30% adopted hybrid work environment; 14% to permanently work from home have reduced headcount, 45% will maintain and 14% are increasing receiving Job Keeper; 40% received nothing at all have export opportunities slowed; 7% have export opportunities ceased RegTechs are reporting a retraction of potential capital Exhibit 6 | Almost half of Australian RegTechs have seen a short-term impact on revenue as a result of COVID-19, but limited impact on operations and fund raising 11Closing the funding gap Helping local RegTechs scale is critical to ensuring they have access to a thriving global RegTech market; global spending on RegTech products and services is estimated to increase to US $127 billion in 2024 4 . This report proposes four pillars to the solution to help close the funding gap for local RegTechs (Exhibit 7). Exhibit 7 | Both public and private entities have a role to play to support funding and promote the growth of RegTechs within and beyond Australia $ 1. Based on feedback collected through primary research with RegTech Association members Source: BCG FinTech Control Tower 1. Drive demand for RegTech services Help financial and other institutions to understand the benefits of RegTechs through: Coordinating industry wide forums and benchmarks. Creating marketplaces for participants to engage in problem solving together. Support certification to maintain standards. Become clients of RegTechs. Create specialised patient capital funding pools from Private Equity or Superannuation funds to invest in RegTechs. Divert a proportion of penalties and fines into funding RegTechs. Establish grant programs for immediate access to funds. 2. Facilitate access to funding 3. Game changing moves by regulators and policy makers 4. Promote RegTech to build profile and talent pipeline Develop an industry - wide roadmap that articulates aspirations for RegTech. Enhance regulatory and policy framework to encourage innovation. Take a supportive regulatory stance as firms test and learn while partnering with RegTechs. Develop and promote interactive programs to solve regulatory challenges with leading edge technology. Form partnerships with universities and start-ups to build interest in the industry as a career choice. 4 Juniper Research (2019), Opportunities for AI in RegTech, UK. 12The Monetary Authority of Singapore (MAS), in partnership with the ASEAN Bankers Association and International Finance Corporation, jointly established the API Exchange (APIX), a cross-border open marketplace enabling financial institutions and FinTechs to collaborate in testing and integrating solutions via the Cloud. To date, Drive demand for RegTech services 1 Government and regulatory bodies can act as stewards for the industry by: Increasing understanding of RegTech solutions and their benefits. Industry forums can educate potential users about types of RegTechs and what they offer. Industry-wide benchmarking of risk and compliance spend can make RegTechs contribution to efficiency and effectiveness of risk and compliance activities visible. Bringing market participants together to collaborate on problem solving. Influencing purchasing decisions, such as through RegTech certification programs that help to maintain and endorse high levels of professionalism in the industry. Becoming clients, since many RegTech solutions are relevant for regulators and other public sector organisations. CASE STUDY Creating a cross-border FinTech/RegTech marketplace The Israel Innovation Authority has a comprehensive program aimed at incubating technology start-ups, where grant funding is provided along with the offer to partner with government entities or selected corporates during the development phase. This allows firms access to government or corporate facilities and data to undertake their trials and develop proofs of concept. In addition, the Authority provided CASE STUDY Partnering with government departments 51 financial institutions have partnered with 328 FinTechs through the platform to launch FinTech software within those institutions. Tookitaki and Merkle Science are examples of Singapore headquartered RegTechs on the APIX platform that successfully raised funding in 2019. US$130 million in direct grant funding to 340 projects in 2019. The Israel Innovation Authority has supported a number of RegTechs since their inception. One example is NICE Actimize that has benefited from the transfer of technology from the best of Israels research institutions for the development of breakthrough products.British Patient Capital was established in 2018 in response to government reviews into the challenges businesses face in accessing capital. The fund has GBP 2.5 billion to invest over a ten-year horizon, making it the largest domestic investor in venture Establish new funding pools with long-term perspectives 2 An influx of long-term or patient capital can foster sustainable investment in RegTechs. Governments, superannuation funds and private equity funds could all play a role as providers of capital as well as being potential clients of the RegTechs that they finance. Australia is familiar with patient capital through investment in life scien