One industry which I expect to continue to go from strength to strength in 2017 is the financial technology or “fintech” industry.
Whilst the UK and United States might be home to some of the world’s biggest fintech companies, Australia is no slouch. Four fintech shares I’ll be keeping a close eye on next year are as follows:
Afterpay Holdings Ltd (ASX: AFY)
This payments company provides retailers with the ability to provide an interest-free buy now, pay later service online and in-store. Afterpay bears the default risk in exchange for a small commission on the transaction. The service has proven to be extremely popular with retailers. Afterpay recently reported that it has over 1,500 retailers currently live on its platform. Its shares do look expensive to me though, so I would suggest investors wait for a pull-back before investing. Rival zipMoney Ltd (ASX: ZML) is also worth keeping an eye on, in my opinion.
Intiger Group Ltd (ASX: IAM)
Intiger has lofty ambitions to become the number one provider of offshore processing and fintech solutions to the Australian financial planning industry. The company aims to capitalise on spiralling back office costs which have led to a severe drop in profitability for financial planners. A recent presentation reveals that financial planners could reduce back office costs by as much as 40% through its platforms and offshore processing,
Praemium Ltd (ASX: PPS)
With over $5 billion of separately managed account funds under administration, Praemium is fast becoming one of Australia’s leading fintech companies. The explosive growth in funds under administration has led the share price of this global provider of investment administration, separately managed accounts, and financial planning technology platforms to rocket 55% in 2016. If it can continue this growth in 2017 then I see no reason why it won’t provide market-beating returns again next year.
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Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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