Fintech and the Green Future of Property Development and Business Investment

In the wake of the national bushfire crisis, the summer of 2020 has been an unexpected time of loss, grief and reflection for Australians, including us at Acumen.

Nathan Daly
December 1, 2020

Fintech and the Green Future of Property Development and Business Investment

In the wake of the national bushfire crisis, the summer of 2020 has been an unexpected time of loss, grief and reflection for Australians, including us at Acumen.

Business as usual, the saying goes –– well, no, not quite. When faced with challenges, such as we are currently experiencing in regards to the bushfires, it often forces us to re-evaluate our existing practices, and make new choices as we take our next step forward.

When we think of upcoming business trends here at Acumen, we believe the future is to be found in the financial technology or Fintech arena, but the future is also green. We have an intimate knowledge of the dynamic Fintech scene, the private lending sector, and the commercial lending landscape. In our analysis of the current business and investment trends, locally and globally, we have seen a significant turn towards sustainable solutions.

If you are looking for greener investment options, either for financing for your project or as First, Second or Third Tier investor, then please get in touch so we can begin matching your needs with our extensive investment network. Please also reach out if you would like more information about our services in general.

If you are yet to consider the green future of finance, then read on to find out more.    

What is Green about the Future of Investment?

The ‘Green Fintech’ movement is heralded as a major trend for the next decade. Perhaps it won’t come as a surprise that the Fintech ecosystem, including P2P (peer-to-peer) lending and private finance options, is one step ahead on sustainability given how it has disrupted and innovated the financial sector to date.

Businesses, commercial and residential property developers, and homeowners are all increasingly looking for sustainable development solutions. So, how do we balance economic growth, meet the ever-growing housing demands across the country, and sustainability?

Balancing Growth with Sustainability  

The bushfire crisis has made many people anxious; this is equally true in regards to property development. Yet residential and commercial property development is inevitable, particularly here in Australia, as we need to meet the demands of our growing population. So, how do we balance the two sides of this equation?  

The world over, businesses are turning towards more sustainable choices as the new norm. There is an increased demand for sustainable solutions across all areas of life, and therefore sustainability is becoming, not just a buzzword, but synonymous with economic growth and development. We can see this in Australia’s property sector, as buyers and renters demand more transparency on energy efficiency.  

Recently, the Bank of Australia has made some effort to meet this need with the introduction of Green home loans. However, such loans come with the restrictions of the traditional banking sector and are for individual home loans only, not larger-scale developments or business initiatives, big or small. Additionally, the conventional banking sector is generally pessimistic about the implications of the climate crisis for financial growth, as demonstrated by the recent analysis by the Reserve Bank of Australia, the body who are responsible for conducting monetary policy.  

The reality is that globally, investors are pulling their money out of fossil fuels, and looking to more sustainable investments. This is particularly challenging for banks whose asset portfolios could be behind the times given that they have channelled investments into the fossil fuel industry for decades. For example, in the UK, the Bank of England warned that assets worth $20 trillion USD could be lost due to climate change.

Why Fintech has a More Optimistic Solution

When it comes to sustainable innovation and investment, there are numerous reasons why Fintech sees opportunity, where traditional banking sectors may struggle. Not only does it lend itself well to the green finance movement, but the Fintech sector is a robust option.   With the anticipated further disruption to the traditional banking sector, and growth expected to reach $390.5 billion USD globally by 2023, it is safe to say we can expect to see a chunk of that investment over here. Especially if Australia's record-breaking year for Fintech investment in 2019 is any indication!

The future is undoubtedly Fintech.    

As business owners, it is imperative to look to our consumers for their demands, and they are asking for more sustainable options. It is an attractive, and perhaps in the future, the only option for investors, developers and clients alike. As the UN Climate Summit indicates, global and local regulations penalising un-environmentally friendly industries are on the way in the coming years, and as we make this shift towards a cleaner economy it is anticipated that up to 80% of the funding needs to come from the private sector.    

At Acumen, we specialise in private, Fintech driven, lending. We work across all Three Tiers to find the best solutions and secure the finance for your projects, ranging from small business loans to commercial mortgage lending, including construction projects. Where the traditional banking industry may have said no, our network of investors and intricate understanding of the industry enables us to say yes. With our finger always on the pulse of the evolving private lending landscape, we are leaders when it comes to development finance and investment lending.

If you are thinking of making sustainable changes to the financing of your next project or would like to invest, then reach out to us to discuss how we can meet your needs as we step into a brighter future together.