Ground Breaking Survey To Focus On Rapid Rise Of Alternative Finance Across Asia Pacific

A number of the world’s leading universities have joined forces to survey the size and potential economic impact of the rapidly expanding alternative finance sector in the Asia Pacific Region.

The 2015 Asia-Pacific Alternative Finance Benchmarking Survey will focus on crowdfunding, peer-to-peer lending and other forms of finance with the ability to disrupt traditional markets. The survey is to be undertaken by The Cambridge Centre for Alternative Finance at Cambridge Judge Business School, the Tsinghua University Graduate School of Shenzhen and the University of Sydney Business School.

The study is supported by KPMG, the CME (Chicago Mercantile Exchange) Group Foundation, ACCA (the Association of Chartered Certified Accountants), and 20 leading industry and academic research partners. It will cover alternative finance in China, Hong Kong, Singapore, Malaysia, the Philippines, Thailand, Indonesia, India, Australia and New Zealand.

Universities define alternative finance as “innovative financial instruments and distributive channels that have emerged outside of the traditional financial system”. These include equity and reward-based crowdfunding, peer-to-peer consumer and business lending (i.e. Marketplace Lending) and invoice trading, all of which are directly connecting lenders to borrowers.

Alternative finance, the universities say, is now providing venture capital for start-ups, funding the creative industries and “creating new ways for individuals and institutions to control how and to whom money is distributed, lent and invested”.

“Alternative finance has the potential to disrupt and threaten the traditional market while offering a new source of funding to SME’s, start-ups and individuals,” said the University of Sydney’s Dr Luke Deer. “Our aim is to inform the public, inform government policy and inform existing financial institutions on the rise of alternative finance,” Dr Deer said.

Welcoming the survey, the Dean of the University Business School, Professor Greg Whitwell described the need information on the largely unregulated Asia Pacific alternative finance industry as “urgent”. “Many countries in the Asia-Pacific such as Australia are debating regulations, yet they are doing so in the absence of reliable data on the scale and type of such financing activities,” Professor Whitwell said.

“The Asia Pacific region includes many of the most populous and fastest growing developing countries in the world and the rapid uptake of mobile technologies and social media is enabling these countries to leapfrog traditional banking infrastructure,” added Robert Wardrop, Executive Director of the Cambridge Centre for Alternative Finance.

“This uptake suggests that the potential growth of innovative alternative finance markets in the Asia-Pacific may be higher than other regions,” Robert Wardrop said. The Dean of Social Sciences and Management at the Tsinghua Graduate School of Shenzhen, Professor Ying Kong, pointed out that China’s online alternative finance market may already be the largest in the world.

“This research is crucial for understanding more about China’s alternative finance market. The results of this research will support the future development of internet finance in China,” Professor Ying Kong said. “This study will contribute to a comprehensive and highly valuable understanding of social-cause based alternative financing activities in the Asia Pacific and mainland China,” concluded Professor Whitwell.

The 2015 Asia Pacific Alternative Finance Benchmarking Research will launch on 12th November with the backing of KPMG, the CME (Chicago Mercantile Exchange) Group Foundation and ACCA.

Leading alternative finance industry and academic research partners are also supporting the project. They include the Crowdfunding Institute of Australia, LendIt, Crowdfund China Society, Hong Kong Crowdfunding Association, Wangdaizhijia, New Zealand Crowdfunding Society, Japan Crowdfunding Council, Crowdfund Asia Association, Korean FinTech Forum, Shenzhen Crowdfunding Association, Change Fusion Thailand, World Crowdfunding Conference, Crowdsourcing Week, Crowdfund Vibe, FinTech Hong Kong, the Asian Venture Philanthropy Network (AVPN), CrowdfundInsider, Nagoya University, the University of Amsterdam and Ahmedabad University.

Ian Pollari, Partner and National Sector Leader, Banking, and Global Fintech Co-Lead, KPMG Australia says his company is “excited” by its research collaboration with its university partners.

“Alternative finance marketplaces are challenging traditional models in the industry, and in many markets, providing access to finance to parts of the populace or small businesses, who are often under-served today,” Mr Pollari said. “There is, therefore, considerable economic and social benefit in understanding the advantages, risks and the broader development of these emerging markets.”

“The ACCA’s support for this first benchmarking study of online alternative finance transactions in the Asia-Pacific is part of our longstanding interest in the development of the online platforms which provide alternative sources of finance; an industry that could have a significant bearing on how businesses access funding in the future.” Added Rosana Mirkovic, Head of SME Policy at ACCA Global.

The survey will close on the 16th of December.