Although the Australian fintech sector is relatively young, startups are achieving success, with nearly half reporting profitability with most remaining bootstrapped, according to a new study by RSM Australia.
The research, which surveyed 135 Australian fintech companies in July and August 2026 to evaluate sector growth, profitability, and regulatory pressures, found that 47% of respondents have reached breakeven, with 62% of those earning more than AUD 1 million in revenue. Another 27% anticipate profitability within the next 12 months.
These results appear despite the industry’s relative youth. 71% of the fintech startups polled in the survey were launched in the past decade. In addition, 28% of these ventures have not raised external funding and remain bootstrapped; of those, half are profitable. This underscores real customer demand alongside strong founder discipline and cost-conscious execution in the sector.
Overall, founder funding remains the primary source of capital, used by 72% of respondents, the study found. However, many Australian fintech startups also draw on support from angel investors (33%), venture capital (VC) (24%), and personal networks (28%).
In terms of government support, Australian fintech startups identified the Research and Development Tax Incentive (RDTI) as the most common program, cited by 50% of respondents. This program, introduced in 2011, seeks to encourage Australian investment in R&D by offering tax offsets for eligible expenditure.
Respondents were also asked which upcoming measures would best support founder-led businesses in Australia. 61% of the respondents selected retention of the 50% capital gains tax (CGT) discount as the most supportive government measure. This is followed by improved clarity on software R&D eligibility, cited by 42% of respondents, and co-investment matching schemes, noted by 28%.
Australia’s 50% CGT discount is a tax concession that can significantly reduce taxes on investment profits. Under current rules, an Australian tax resident individual who sells an eligible asset held for at least 12 months can generally reduce the capital gain by 50%.
Though the existing 50% CGT discount is still in place, replacement reforms have been legislated. From July 01, 2027, the government will replace the 50% CGT discount with a discount based on inflation and introduce a minimum 30% tax on gains.
Australia’s fintech landscape
Australia’s fintech industry is led by the payments vertical, representing 31% of those surveyed. Lending and credit follow at 18%, business tools and software-as-a-service (SaaS) at 14%, and wealth and investment, alongside data analytics at 10% each.
Business-to-business (B2B) models are favored, adopted by 67% of respondents. A further 27% use a business-to-business-to-consumer (B2B2C) approach, reinforcing the focus on business clients.
The study found that while Australia is clearly the sector’s primary market, many operate beyond its borders. 62% of the startups polled generate revenue only locally. However, 23% of them are actively pursuing international expansion.
Results from the RSM Australia and Fintech Australia study match those of an earlier Deloitte research, which described the sector as a cornerstone of Australia’s economy.
The research found that the Australian fintech sector directly added AUD 13.6 billion (US$9.3 billion) in value to the country’s GDP in 2024-2025, with a further AUD 10.6 billion (US$7.4 billion) in indirect value generated through their demand for goods and services from upstream industries.
This sector now includes 800 fintech companies across various verticals, comprising both domestic and international players, according to new research conducted by Fintech News Australia.
Featured image: Edited by Fintech News Australia, based on image by f11photo and tinuwielll via Magnific
