Australian fintech landscape 2025

The current Australian fintech landscape

The Australian fintech ecosystem remained broadly stable in 2025, with 801 independent Australian owned fintech companies, marking a slight 2% decline year-on-year change from 2024. This decline, whilst smaller than previous years, clearly illustrates the challenges that the local sector continues to face.

With investment levels at lows not seen since 2020 (KPMG Pulse of Fintech H1’2025) and continued macroeconomic as well as geopolitical uncertainties, investors found it challenging to feel confident in their dealmaking activities. This resulted in a decline in the number of active companies in the Australian fintech ecosystem, partly due to M&A activity.

Australian fintech companies are faced with a number of challenges in the current climate, including the limited size of the local market, the difficult capital raising environment (particularly at an earlier stage in the start-up and scale-up stages of growth) and the lack of viable exits. That being said, the pace of decline has slowed down significantly from previous years, possibly indicating that the ecosystem might have finally reached a more sustainable size and providing hope that we have reached and indeed passed the bottom of the investment cycle, after speculative and rapid expansion in the prior years.

Download the Australian Fintech Landscape snapshot

Our one-page snapshot showcases the breadth of fintech companies operating in Australia. Download your copy now.

KPMG Australian Fintech Landscape 2025

One page snapshot of the Fintech landscape in Australia in 2025

Download

Fintech market update

Australian deals in 2025 have been characterised by strategic consolidation and acquisitions, enabling leading players to strengthen their positions while weaker firms were forced to exit the market. This rationalisation reflects a maturing industry where scale, compliance, and operational resilience are critical to long-term success.

Despite the above, a number of sectors have shown signs of resilience and/or noteworthy trends:

Growth sectors such as lending and payments maintained their dominance, while niche areas saw a modest contraction, underscoring the shift in investor focus from speculative ventures to sustainable business models.
Regtech and middle/back-office providers continue to gain traction as financial institutions prioritise efficiency and compliance, with AI solutions being applied to improve workflows and operational efficiency, and ultimately cut costs.
At a sector level, digital assets and currencies attracted the most fintech investment globally. But despite strong growth, investment is expected to remain below the 2021 peak. Investor interest focused on stablecoins, particularly for trading, remittances, and payments in emerging markets.

Market sentiment has improved modestly compared to last year, buoyed by rate cuts taking place over the course of 2025. Lower borrowing costs should help to ease capital constraints and revive investor confidence, particularly for growth-stage fintechs that have faced funding headwinds. Although capital remains selective, investors are increasingly favouring businesses with strong fundamentals, clear regulatory alignment, and scalable technology.

Looking ahead, fintech investors are likely to remain selective with their dealmaking. The ecosystem is entering a phase where quality trumps quantity, and partnerships between fintechs and incumbents are accelerating. Any recovery in the Australian fintech sector, will ultimately be dependent on macroeconomic conditions stabilising and funding availability improving, including a favourable monetary policy environment, with fintech companies focused on building sustainable, scalable and ultimately global business models likely to attract the most attention.

Fintech sectors in focus

Key focus areas for the financial technology industry in Australia.

The blockchain and crypto segment continues to be a very active one in Australia, despite a slight contraction also this year. This consolidation was long overdue, with the number of active companies falling from 77 in 2024 to 72 in 2025 (-6%), reflecting ongoing market rationalisation. Improved regulatory clarity and institutional adoption are driving maturity, with a shift from speculative projects to infrastructure and compliance-focused solutions.

Key trends include the rise of tokenisation of real-world assets, blockchain-based identity verification, and enterprise-grade solutions for supply chain transparency. Major players are increasingly partnering with traditional financial institutions to integrate blockchain into payment rails and settlement systems. While retail crypto trading remains subdued due to global volatility, stablecoins and CBDC pilots are gaining traction, supported by the Reserve Bank of Australia’s exploratory initiatives.

Looking ahead, the sector’s growth will hinge on regulatory harmonisation and the ability to deliver tangible business value beyond speculative trading.

The fundraising segment saw a modest decline, with 14 active companies in 2025 compared to 15 in 2024 (-7%). This reflects tighter capital markets and a shift toward quality over quantity. Equity crowdfunding platforms remain the dominant model, but there is growing interest in hybrid fundraising solutions that combine traditional equity with tokenised assets.

Investor appetite is gradually recovering, aided by expectations of lower interest rates and improved liquidity conditions in 2026. Platforms that can demonstrate strong compliance frameworks and investor protection mechanisms are best positioned to thrive.

Despite the challenges, the sector continues to play a critical role in supporting early-stage ventures, particularly in underserved segments such as regional startups and niche technology verticals.

Regtech and middle & back office solutions remain a key sector within the Australian fintech ecosystem. Combined, these categories account for 129 companies (Regtech: 44, Middle & Back Office: 85), representing 16% of the total market. Demand is being driven by increasing regulatory complexity, cost pressures, and the need for operational resilience.

Regtech players are focusing on real-time compliance monitoring, AML/KYC automation, and AI-driven risk analytics, helping institutions manage obligations efficiently. Meanwhile, middle and back-office providers are innovating in workflow automation, data reconciliation, and cloud-native platforms, enabling scalability and cost optimisation for financial services firms.

Key players are leveraging partnerships with banks and insurers to embed solutions into core systems, while startups are differentiating through advanced analytics and API-first architectures. With regulators pushing for greater transparency and operational robustness, this segment is expected to see sustained investment and adoption in the coming years.