FinTech Australia has urged the Federal Government to widen access for smaller technology firms in federal procurement and adjust key funding settings for emerging fintechs in its latest pre-budget submission.
It argues that federal tender processes and contract settings often favour large suppliers, creating barriers for smaller and newer businesses. It also wants changes to mechanisms that shape early-stage capital availability, including venture capital tax concessions, superannuation investment settings and the Research and Development Tax Incentive.
FinTech Australia says procurement settings tailored to small and medium-sized businesses would lower barriers to entry, while improving revenue certainty and cash flow for growing firms looking to expand.
“Australian fintechs have the capabilities and knowledge to solve many of the Federal Government’s key financial challenges, and in turn grow their business, unlock further productivity and create jobs,” said FinTech Australia CEO Rehan D’Almeida.
The group also described procurement access as a commercial signal that can influence growth beyond government work. Winning government contracts, it said, can lift credibility and make it easier to secure private-sector customers.
“Securing government work would also have a compounding effect: it gives fintechs credibility, which in turn helps them win more local customers and scale more quickly. Yet extensive government tender processes that are almost designed for larger players lock smaller and emerging companies out of participating. We often see the same contracts awarded to large companies, simply because they are the only ones with the resources to participate, or the terms blatantly disqualify smaller firms,” he said.
Funding pressures
Alongside procurement reform, FinTech Australia pointed to tighter conditions for early-stage funding. It cited Cut Through Venture data showing a 17 per cent decline in the number of funding deals last year, despite an increase in the total amount of capital invested.
The combination suggests fewer, larger funding rounds across the market. FinTech Australia said this has made it harder for early-stage fintechs to raise capital on terms that support growth without heavy dilution or restrictive conditions.
“We’ve called this out before, but the two-speed fintech ecosystem still persists,” D’Almeida said. “Existing funds and VC are largely fuelling established players, leaving our next-generation unicorns behind. It’s in this space that the Federal Government can make a tangible difference with targeted reform – both to the ecosystem and, in turn, Australia’s economic outcomes.”
The submission also raised a set of long-running policy issues, including work on data and digital infrastructure, the regulation of emerging technologies and the resourcing of key oversight agencies.
Data and scams
FinTech Australia backed continued support for the Consumer Data Right and associated digital infrastructure, linking it to trust among consumers and small businesses in data-driven financial services. It also pointed to scam and cyber initiatives, such as the National Anti-Scam Centre, as part of the broader environment for safe adoption.
The Consumer Data Right has been central to Australia’s approach to open banking and data portability. Fintech providers have used it to build products based on secure, consent-based data sharing, though industry participants have raised concerns about rollout timelines, compliance complexity and the pace of adoption.
AI and testing
On artificial intelligence and emerging technologies, the submission called for a stronger national AI capability and more investment in testing and assurance. It also urged improvements to tools such as the Enhanced Regulatory Sandbox, which allows businesses to trial financial services products within defined parameters.
FinTech Australia said these measures would help early-stage firms experiment while meeting expectations for consumer protection and compliance. It also linked this agenda to reforms affecting digital lending and broader modernisation of the regulatory framework.
Regulators resourced
The submission called for “smarter, better-resourced regulation”, arguing that agencies, including ASIC, APRA, the ACCC and AUSTRA,C need support as mandates expand. It said capacity will be increasingly important as rules change across home ownership, digital lending and the broader digital economy.
Regulatory capacity has become a recurring issue for fintechs operating across banking, payments, crypto-related services and regtech. Many newer firms operate under multiple regimes and face evolving expectations on identity, fraud controls and operational resilience.
Trade and green finance
FinTech Australia also asked for measures to lift international competitiveness, including coordinated export and trade support. It pointed to FinTech Bridge arrangements as a channel for cross-border collaboration and called for fintech to be recognised as an “enabling capability” within programs such as the National Reconstruction Fund.
On sustainability, the submission called for incentives to expand access to green fintech tools for small and medium-sized businesses, highlighting services related to climate reporting, green lending and ESG data analytics.
FinTech Australia represents more than 400 fintech companies and startups across Australia. It said its policy agenda reflects persistent pressure points as local firms seek customers, capital and regulatory clarity.
“The stakes are higher with this Federal Budget than others in the past. Australia’s fintech industry is well placed to deliver on the economic outcomes the Government is searching for – boosting productivity, creating jobs and ultimately raising our standard of living,” D’Almeida said.
