taipei fubon

How Taipei Fubon Bank Handles Wealth Management in the Digital Era

Taipei Fubon Commercial Bank won six major awards in The Digital Banker’s 2nd Annual Global Retail Banking Innovation Awards, reaffirming the bank’s commitment to customer service and excellence in digital banking innovation.

One of the top banks in Taiwan, Taipei Fubon Bank is well-known for creating innovative products and has been a leader in using AI, mobile, digital and blockchain technologies to improve banking customer experience. The Digital Banker and co-judges from PWC, KPMG, Forrester and Xerox, selected Taipei Fubon Bank as a winner for Best Customised Mobile Banking, Outstanding Machine Learning Initiative, Outstanding IT Transformation and Excellence in Customer Privacy & Protection.

The Bank also received “Highly Acclaimed” for Excellence in Digital Wealth Management and Outstanding Digital Innovation in SME Banking. Roman Cheng, President of Taipei Fubon Bank said that “our goal is to keep learning from customers, business partners as well as from competition”.  He hopes that this discipline of learning helps his team in designing products and services suitable for customers and this process is the primary underpinning of Taipei Fubon Bank’s Digital Transformation success.

“Our goal is to keep learning from customers, business partners as well as from competition.”

Customised Mobile Banking

The above culture led the bank to re-launch Fubon Mobile Banking in mid-2018 and was immediately endorsed by strong customer response, transforming it into the leading and the most comprehensive mobile banking app in the Taiwan market.  The bank also offered high level of customisation to mobile banking users under the theme “My Screen, My Way”, “My Account, My Way” and “My Family, My Way”.

The design of this mobile app was based on exhaustive user interviews and user-experience workshops with the frequent mobile banking users. The findings of this study revealed several behavioural insights that were then used to design the mobile banking platform.  Examples of unique services are ‘Goal-Based Savings’ and ‘Life Accounting’ for Gen-Y customers.

AI and Machine Learning

Taipei Fubon Bank is also a leader in Big Data Analytics, optimising its operations as well as enhancing its customer service using predictive models.  It has successfully implemented Machine Learning Predictive Modelling that leverages data from several internal and external sources. The model has already proven its strong predictive power by forecasting next-best-product for wealth management customers.

Taipei Fubon Bank is using Digital & Data to not only enhance customer experience but also to improve security & privacy of its customers.

Wealth Management for the Digital Era

 Taipei Fubon Bank has been actively developing financial technologies and products to service the rapidly changing needs of the digital generation. It is also leveraging efficiency of digital channel to deliver superior financial services to mass market customers.

The bank collaborated with Europe’s largest online asset management firm – Nutmeg, to launch “Nano Investment”. This platform enabled access to WM services to Younger as well as low-ticket size investors.  Investors with as little as USD100 may commence their investment journey and build a portfolio customised to their individual needs.  The simplicity and control this wealth management platform provides to customers has been widely acclaimed and an increasing number of customers are joining the Nano platform.

Customer Privacy & Protection

 Taipei Fubon Bank is using Digital & Data to not only enhance customer experience but also to improve security & privacy of its customers.  A strong example of this is “Automatic Personal Data De-identification Platform“ implemented in 2018 to ensure highest level of security to customer’s private information.  Taipei Fubon Bank is among a few banks in Asia and the first in Taiwan to have implemented such innovation for customer data protection.

 

>> To read more about this story and other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.

 

Image: TK Kurikawa / Shutterstock.com

standard chartered bank

Standard Chartered Bank: Disrupting through digital and partnerships

Standard Chartered Bank dominated the Institutional Awards category at The Global Retail Banking Innovation Awards 2019 by winning Best Retail Bank of the Year in Hong Kong, Africa and Vietnam. The bank’s Singapore and Malaysia Retail Outfits were also awarded. We spoke to Aalishaan Zaidi about the bank’s winning strategy and what to expect in 2020.

Standard Chartered Malaysia bagged five impressive awards, winning ‘Best Savings Account’ and ‘Best Internet Banking Initiative’, while being Highly Acclaimed for ‘Best Customer Service Innovation’,’ Best Self-Service Banking’ and ‘Best New Product Launch’.

The bank’s Singapore retail business was also awarded with highly acclaimed accolades in ‘Debit Card of the Year’, ‘Best Mobile Banking’ and ‘Outstanding Client Onboarding & Account Opening’.

The Digital Banker interviewed Aalishaan Zaidi – Global Head, Client Experience, Channels & Digital Banking, to learn more about the bank’s success over the last year, together with its objectives for 2020.

Aalishaan Zaidi

TDB: As you reflect on 2019 to date – what stands out for you? 

AZ: 2019 has certainly been another action-packed year so far and we’ve continued to make strong progress across our regions.

Following the launch of our digital-only bank in Côte D’Ivoire last year, we have now rolled out the same model in seven more African markets (Uganda, Tanzania, Ghana, Kenya, Botswana, Zambia, Zimbabwe), and Nigeria will go live in Q4. If we look at the Africa region with its youthful population that is increasingly digitally-savvy, combined with the proliferation of mobile phones, the benefits for our clients enabled by this mobile-powered financial revolution are clear. These new banks build on the original platform that can onboard clients in under 15 minutes and provides 70 of the most common service requests, to now also providing enhanced services including QR code and P2P payments, loan and overdraft facilities, and instant fixed deposits.

In Hong Kong, we have created a joint venture under the umbrella of SC Digital, partnering with PCCW-HKT (Hong Kong Telecom) and Ctrip (Asia’s online largest travel agency). We are working to bring banking, lifestyle, travel, telco and entertainment together all in one place under a new brand, with a new technology stack, and offering a new experience to customers in Hong Kong.

We have continued to improve the client experience for online and mobile banking in many other markets in our retail banking footprint. The real-time onboarding system, which helps clientsopen a bank account instantly, is now in India and Singapore, with more countries to follow.

We also have a bilingual chatbot in Hong Kong, named Stacy, who chats with clients in English and Cantonese. Stacy is powered by artificial intelligence and natural language processing capabilities and has contributed to a significant increase in client engagement. Our latest SC mobile app was recently released in Korea with new features such as personal finance management.

These are just a few major milestones we’re proud of and the year is not over yet!

We have a bilingual chatbot in Hong Kong, named Stacy, who chats with clients in English and Cantonese. Stacy is powered by artificial intelligence and natural language processing capabilities.

TDB: The Monetary Authority of Singapore (MAS) recently announced it will issue up to 5 virtual bank licences. The initiative is said to bolster the retail banking sector – how much of a threat and/or opportunity is this likely to be for SC in Singapore?

AZ: We support measures which encourage the industry to innovate and digitalise. Disrupting through digital and partnerships is part of our strategy to reinforce our competitive advantage.

We subscribe to the same sentiment which Ravi Menon from the MAS expressed a couple of years back: “If we do not disrupt ourselves in a manner of our choosing, somebody else will do so in a manner we do not like”.

This is an opportunity for us to explore new business models and to provide increasingly appropriate and innovative services to new and existing customers.

We have a very strong record in digital banking and continue to invest in our digital offerings to meet the needs of our clients such as those mentioned above. In addition to our joint venture in Hong Kong, under the umbrella of SC Digital partnering with PCCW-HKT and Ctrip, we are part of a consortium which recently received a virtual banking licence in Taiwan (we have a 5% stake in Line Bank – led by Line Financial Taiwan Corp., a subsidiary of Line Taiwan Ltd., linked to the popular LINE messaging app).

We subscribe to the same sentiment which Ravi Menon from the MAS expressed a couple of years back: “If we do not disrupt ourselves in a manner of our choosing, somebody else will do so in a manner we do not like”.

TDB: What’s the bank’s approach to FinTechs and big techs? 

AZ: We believe banks and FinTechs/TechFins have mutually beneficial relationships. As a Bank, we’re always open to collaborate with FinTechs and big techs to test out new solutions to provide the most seamless banking experience for our clients. There are certain areas of emerging technology where, in the consumer banking space, we are more focused on – those include data analytics, client authentication, and conversational banking services.

SC Ventures, which is our innovation, FinTech investment and ventures unit, is an enabler to this. It aims to develop an innovation culture and mindset, deepen capabilities and experiment with new business models through an open platform and network of people and partnerships.

Disrupting through digital and partnerships is part of our strategy to reinforce our competitive advantage.

TDB: What are your top three priorities for 2020?

AZ: Looking ahead to 2020, some of the work we have started this year will continue to be top priorities. 1) Reshaping our ways of working to be more client-centric, with cross-functional enterprise agility 2) Continuing to experiment with disruptive models through fintech solutions and new platforms or partnerships; and 3) Keeping cyber safety and security top of mind as clients’ banking habits continue to shift towards digital channels.

TDB: Will SC be applying for a digital banking licence in Singapore, and if so, do you have any partners in mind?

AZ: In Singapore, while we are interested in applying for a digital banking licence, finding the right partner will be key. Our experience in Hong Kong and Taiwan will serve us well as we continue to explore the best digital model for our clients in Singapore.

 

>> To read more about this story and other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.

 

Image: DavidNNP / Shutterstock.com

Why Open Banking is a Top Strategic Priority in Retail Banking - TDB

Why Open Banking is a Top Strategic Priority in Retail Banking

In a world that is increasingly becoming more connected and democratised, banking and financial institutions serve as a significant catalyst of change. And this can be seen with the rise of Open Banking.

Connecting via third-party application programming interfaces (APIs), Open Banking enables traditional banks and FinTech companies to share data and collaborate to offer products and services that the others cannot. The result? A far richer, caring and customer-centric experiences as such partnership give consumers unprecedented access to more advanced financial options built on data-driven insights.

The Challenges of Open Banking

A study of the future of retail banking conducted by The Economist Intelligence Unit revealed that in 2025, expected key strategic priorities would be Open Banking (30%), cutting costs (29%), migrating to digital channels (28%) and digital marketing and engagement (27%). Indeed, today’s unrelenting focus on data will drive Open Banking to the forefront of retail banking innovation.

Today’s unrelenting focus on data will drive Open Banking to the forefront of retail banking innovation.

Top Strategic Priorities by 2025

In the current scenario, most banks have total control over their customer data – a closed model that allows them to own the financial market as the only source for traditional services – and keep competitors at bay. This control changes with the data sharing impact of Open Banking regulations. With data sharing, capabilities will expand to items such as account aggregation, financial management and credit scores. It will also result to integrated lending and accounting platforms that will make it easier to create customised products for target customers.

Top Strategic Priorities 2020 - Open Banking - TDB - chart

 

Of course, this optimistic depiction of the future of Open Banking doesn’t come without challenges. Some of them include:

1. Customer Acceptance
Lack of awareness and education around Open Banking’s capabilities could be a challenge. Customers need to be convinced to share their data as data security and privacy remains a major concern. The demand for value is also a challenge as studies show that most consumers need to see tangible value.

2. Consumer Awareness
This reluctance is largely a result of customers threading on unfamiliar banking grounds. Banks must deliver effective communication and education especially with changes to banking terms and conditions.

3. Competitive Disadvantages
Backed by strong investments, FinTechs, pure-digital companies and non-banks such as Amazon have created a new digital banking ecosystem that traditional banks are hard-pressed to emulate. From under $2 billion in 2010, investment in FinTechs will reach $150 billion between 2019 and 2021 worldwide.

4. Data Sharing Blues
Open Banking is built on data sharing. Difficulties from control and exposure of customer data to product cannibalisation can stifle meaningful participation in this ecosystem.

5. Legacy systems
The complexity of legacy systems can hinder effective interoperability with open banking APIs and the shift to agile, customer-centric systems.

The Future of Open Banking

A unified digital platform, as a result of the Open Banking revolution, will make financial products and services more transparent. That’s on top of making them faster, cheaper, and more convenient.

More banks are securing their role in the Open Banking model by publishing their APIs and actively trying new FinTech partnerships. This revolutionary collaboration between banks and FinTechs will enable consumers to enjoy better financial management, make better decisions, and have more choices of innovative financial solutions.

A unified digital platform, as a result of the Open Banking revolution, will make financial products and services more transparent. That’s on top of making them faster, cheaper, and more convenient.

For example, Taishin Bank’s Richart was developed as an open bank, which integrates all the services that customers need in one platform. From account opening, saving money, investing, to foreign currency exchange, Richart and its partners created a user-centric digital environment to respond to users’ expectations, providing customers with more innovative and complete financial services with partners from different industries, including the telecom company, FinTech start-ups and insurance companies.

In the past, customers need to fill out replicated application forms when they apply for different financial services. To save time for customers, Richart use open API to transfer customers’ information between different partners and help customers fill out forms automatically. Once customers become Richart members, they will no longer need to fill out forms when they apply for other financial services on Richart App. By simply clicking a few buttons, customers can easily complete their application of various financial services such as insurance purchasing, foreign currency exchange, and investing.

In the future, we will see more platforms such as Richart being implemented in different parts of the world.

Today, banks can start to gradually offer platforms for financial service infrastructure similar to disruptors like Amazon, iTunes and AliExpress. While they may lose service fees, volume gains will be huge as this enrichment of the user’s financial journey will attract even more new customers.

>> To read more about this story and other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.

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OneConnect, UnionBank, Sinar Mas launch smart lending platforms aimed at inclusive growth

OneConnect Financial Technology Co. Ltd. (OneConnect), announced it is leading Southeast Asia’s sustainable financing with two smart lending platforms – SeekCap, the Philippines’ first lending platform that helps the underserved micro, small and medium enterprises (MSMEs) manage cashflow and grow their business, as well as a multi-finance platform that will empower millions of unbanked and underbanked Indonesians with easy access to loans to finance their purchase of vehicles essential for their daily transportation.

SeekCap – The Philippine’s first lending platform to meet the banking needs of MSMEs

OneConnect and UBX Philippines Corporation (UBX), the wholly-owned fintech subsidiary of UnionBank of the Philippines (UnionBank), launched SeekCap, the first MSME lending platform in The Philippines.

Through SeekCap loans marketplace, multiple lenders can on board their loan products allowing borrowers to choose what best suits their business needs, and apply for loans digitally and seamlessly on a single end-to-end platform. Loans can be approved on the same day, and disbursed within three working days. This drastically shortens turnaround time as compared with traditional loan applications in The Philippines.

OneConnect, UnionBank, Sinar Mas launch smart lending platforms aimed at inclusive growth - TDB

SeekCap screenshot

Multi-finance lending platform in Indonesia

In addition, OneConnect and Sinar Mas Multi-finance, a subsidiary of Sinar Mas Multiartha (Sinar Mas Financial Services Group) and part of the Sinar Mas conglomerate in Indonesia, today signed an agreement to build one of Indonesia’s first multi-finance platforms to give millions of Indonesians easy access to loans to finance their purchase of motorcycles and cars as transport necessities that greatly enhance mobility and improve livelihoods.

Championing inclusive growth for sustainable business and better living standards in Southeast Asia

The two smart lending platforms use advanced technologies to democratize access to credit facilities and champion inclusive growth for everyone to achieve sustainability in business management and better income.

MSMEs form the backbone of any economy. In the Philippines, more than 99% of all businesses are MSMEs and they contribute to almost 63% of total employment. Yet, at present, only 9% of loans and financing from the country’s major banks go to MSMEs. With a digital lending platform like SeekCap, MSMEs can easily obtain loans to better manage cashflow and grow their business.

In Indonesia, many people aspire to have a better income and improve their lives. Owning a vehicle as a basic mode of transport can empower an Indonesian to start his own business, and use it as his or her everyday transportation mode, for instance. This creates a sustainable standard of living, as well as millions of Indonesians being able to obtain loans to enjoy better access to education and formal job markets.

The two smart lending platforms use advanced technologies to democratize access to credit facilities and champion inclusive growth for everyone to achieve sustainability in business management and better income.

When people’s livelihoods improve and businesses flourish, poverty will be reduced and the country’s economic output will increase – thus achieving inclusive and sustainable growth.

According to Ms Tan Bin Ru, CEO of OneConnect Financial Technology: “The Philippines is a strategic market for OneConnect. Though the World Bank figure shows that only 35% of Filipinos have formal bank accounts in 2018, this figure is a good increment from the preceding years. Filipinos have also been making a lot of digital payments and remittances in recent years. These are clear signs that Filipinos welcome new technologies, and I expect digital transformation in The Philippines’ financial sector to scale considerably.”

Stated Mr John Januszczak, president and CEO of UBX, “I am very pleased with the outcome of SeekCap. When UBX entered into a technology development alliance with OneConnect, we envisage a high performing digital platform that would showcase cutting-edge proprietary technology found nowhere else – OneConnect has impressed us and delivered us the first of its kind lending platform for MSMEs in The Philippines within a short span of four months.”

Mr Doddy Susanto, President Director of Sinar Mas Multiartha said, “There is a vast lending gap in Indonesia and we are harnessing cutting-edge technology to narrow that gap. We are glad that OneConnect is our technology partner as we embark on our transformation roadmap to digitize our channels and banking products and services.”

Billionaires Report 2019 APAC has the highest number of billionaires worldwide - The Digital Banker

Billionaires Report 2019: APAC has the highest number of billionaires worldwide

Billionaire-controlled companies have returned almost twice the average market performance over the past 15 years, new research published today reveals.

This is one of the findings of the annual UBS and PwC Billionaires Insights report, The Billionaire Effect. The report also reveals that, over the five years to the end of 2018, billionaire wealth grew by more than a third (34.5%), reaching a total of USD 8.5 trillion, USD 2.2 trillion higher than five years earlier. In the same period, 589 individuals became billionaires increasing the population by 38.9% to 2,101.

APAC has 754 billionaires with a combined wealth of USD 2.5 trillion

Looking at Asia, wealth of the billionaires in the region has quadrapled in over five years. APAC continues to have the highest number of billionaires worldwide, with 754 billionaires. They represent 36% of global billionaire population with a combined wealth of USD 2.5 trillion. From 2003 to 2018, APAC publicly listed billionaire- controlled companies had the second greatest annualised average return at 18.3% in the world.

China’s entrepreneurs have become the world’s second largest billionaire group over the past five years, overtaking Russia. Their net worth has tripled, reaching USD 982.4 billion in 2018. China has 325 billionaires (43% of APAC billionaires). But in 2018, Chinese billionaires’ net worth decreased by 12.3%.

Ravi Raju, Head of UHNW APAC, UBS Global Wealth Management commented: “In Asia, most of our clients are first generation entrepreneurs and we have been collaborating with them for over 50 years. Entrepreneurs account for 70% of our client base in Asia Pacific and they are key drivers of wealth creation here. In particular, Asia billionaires-controlled companies were more profitable than the market over the past 10 years.

China’s entrepreneurs have become the world’s second largest billionaire group over the past five years, overtaking Russia. Their net worth has tripled, reaching USD 982.4 billion in 2018

Focus on succession planning and sustainable investments

With a significant wealth transfer of USD 3.4 trillion in the next 20 years globally, it is heartening to note that many of our Asian business families have increasingly been focused on succession planning and sustainable investments. At UBS, we provide a holistic approach to engaging our billionaire clients on their business, investment and family legacy needs,“ he concludes.

Julia Leong, Partner, Private banking leader with PwC Singapore commented: “Economies across the Asia Pacific continue to mature at an accelerated pace and the number of Billionaires have grown in tandem. While Asia continues to be seen as having more traditionally male-dominated cultures, it is heartening to see that the number of female billionaire has grown to more than double over the last five years. We have observed that female billionaires are highly driven, at times more than men, and this is likely one of the key contributing factors to this rise.

UBS Billionaire Report 2019 - The Digital Banker

UBS Billionaire Report 2019

Key findings:

  • Over the last 15 years to the end of 2018, billionaire-controlled publicly listed companies returned almost twice the average market performance. Their annualized performance was 17.8% versus the 9.1% of the MSCI AC World Index.
  • Over the five years to the end of 2018, billionaire wealth grew by more than a third (34.5%), reaching a total of USD 8.5 trillion.
  • APAC has the highest number of billionaires worldwide, with 754 billionaires. They represent 36% of global billionaire population with a combined wealth of USD 2.5 trillion.
  • Over the past five years, China’s entrepreneurs have become the world’s second largest billionaire group. Their net worth has tripled, reaching USD 982.4 billion in 2018. China has 325 billionaires (43% of APAC billionaires).
  • The number of female billionaires has grown by 46% in five years. Their assets had expanded by over a quarter (26%) to USD 871.2 billion, lifted mainly by progress in Asia.

To download the 2019 UBS/PwC Billionaires report and previous versions, please visit: http://www.ubs.com/global/en/wealth-management/uhnw/billionaires-report.html or http://www.pwc.ch/billionaires-insights

>> Read other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.

tdb update 2

Ripcord to digitize process for Japan’s largest bank MUFG

Ripcord takes its first step into international expansion by teaming up with Japan’s largest bank to evolve transactions in personal banking

Ripcord, the world’s first robotic digitization company dedicated to creating a truly paperless world, is announcing its commitment to expand into Japan as part of a first step into international expansion. Ripcord has identified a commitment throughout Japan to digitally transform and rely less on paper over time, and, by taking paper documents, digitizing them, using AI powered entity extraction, and making them available to the customer, it is positioned as the perfect solution for this evolution.

MUFG Bank, the largest bank in Japan, has enlisted Ripcord’s Robotic services to digitize critical and sensitive documents at a high resolution, and funnel that data into their data platform which can feed into all the bank’s branches. Everything will be automated and digitally transformed.

With a multi-year contract, Ripcord’s technology will digitize MUFG Bank’s documents. MUFG Bank has hundreds of millions of sheets of paper kept in a central location that isn’t readily accessible to branch locations. With MUFG Bank’s decision to use Ripcord technology to digitally transform these documents and processes, it will improve on a legacy system by making the digital documents immediately accessible by all the branches materially reducing time it’s required to retrieve customer information.

MUFG Bank will utilize Ripcord’s robots and artificial intelligence platform in Japan to enhance its data, making it more efficient and powerful while fully integrated within their big data platform.

This is an iconic partnership between the leader in Japanese banking and innovative new technologies from Silicon Valley in order to help MUFG Bank enhance its digital transformation efforts.

MUFG Bank will utilize Ripcord’s robots and artificial intelligence platform in Japan to enhance its data, making it more efficient and powerful while fully integrated within their big data platform.

Landing in the third largest economy in the world

On the strength of this partnership, Ripcord will expand throughout Japan. The operations center will establish Ripcord’s beachhead in the Japan market with MUFG Bank as its first customer in the region making it a highly credible player in the digital transformation space.

“Ripcord is excited to further our global expansion into Japan while working with Japan’s largest and most respected bank, MUFG Bank.” said Alex Fielding, CEO of Ripcord. “Organizations throughout Japan are looking for ways to digitize content and gain greater efficiencies in their business processes. This partnership will provide us with a strategic foothold to expand further into the country as a whole.”

About MUFG Bank
MUFG Bank, Ltd. is Japan’s premier bank, with a global network spanning around 50 countries. Outside of Japan, the bank offers an extensive scope of commercial and investment banking products and services to businesses, governments and individuals worldwide.
MUFG Bank’s parent, Mitsubishi UFJ Financial Group, Inc. (MUFG) is one of the world’s leading financial groups. Headquartered in Tokyo and with over 360 years of history, MUFG has a global network with around 3,000 locations in more than 50 countries. The Group has over 180,000 employees and offers services including commercial banking, trust banking, securities, credit cards, consumer finance, asset management, and leasing. The Group aims to “be the world’s most trusted financial group” through close collaboration among our operating companies and flexibly respond to all of the financial needs of our customers, serving society, and fostering shared and sustainable growth for a better world. MUFG’s shares trade on the Tokyo, Nagoya, and New York stock exchanges.

For more information about MUFG Bank, visit www.mufg.jp/english.

About RIPCORD
Ripcord is transforming the $62 billion records management, RPA, MPS, and ECM space through robots that scan, index and categorize paper records, making them searchable in the cloud and integrated into existing enterprise systems. Ripcord is based in California. and has raised $65 million from leading investors including Kleiner Perkins, Google Ventures, Baidu, Lux Capital, Silicon Valley Bank, Steve Wozniak, Legend Star, and Icon Ventures.

For more information about RIPCORD, visit www.ripcord.com

How J.P. Morgan Helps Asia's Ultra-Rich Families Plan for Digital Disruption

How J.P. Morgan Helps Asia’s Ultra-Rich Families Plan for Digital Disruption

Even before the phenomenal blockbuster Crazy Rich Asians hit the cinemas middle of last year, Asia has already been attracting tons of attention for its growing number of wealthy populations. Two of the most populous nations on earth are in Asia – China and India – and are both minting millionaires and billionaires faster than ever before. Add to that, the rapid technological advancements are creating huge advantages for businesses run by Asian families, allowing them to directly compete with their Western counterparts. The result is an unprecedented explosion of opportunity for wealth creation.

The growing number of Ultra-High Net Worth Individuals (UHNWI) in Asia is certainly an indication that a lot of correct decisions were made by the current generation of business owners. However, faced with digital disruption brought about by things such as big data, artificial intelligence (AI) and fintech, how are the current generation of business owners preparing the next generation in line? How are the next generation in line going to confront technological disruption in the family business? Is proper succession planning in place? The Digital Banker investigates.

Asia – Home of the Ultra-Rich

The Asia Pacific region is home to the world’s richest families. According to a recent study by UBS and PwC, the region had 814 billionaires at end-2017, an increase of 14% from previous year. This accounts for 38% of the global billionaire population. It’s also interesting to note that China’s billionaire entrepreneurs are not only leading their country’s economic transformation but that of Asia’s as well. In fact, many Chinese entrepreneurs are challenging Silicon Valley, producing many unicorn companies (companies with a valuation of US$1 billion or more) that rival that of the United States’.

Fueled by China’s economic rise, the net worth of APAC billionaires grew by 32% to USD 2.7 trillion in 2017. With this trajectory, it is projected that they will be wealthier than their American counterparts in about three years or less.

After China, India and Indonesia both provide a conducive atmosphere for wealth creation. According to the same study, “India’s billionaire wealth increased by a substantial 36% in 2017 at USD 440.1 billion. The number of local billionaires increased by 19 to 119. In Indonesia, billionaire wealth increased by 37% to USD 72.5 billion, while the number of billionaires stood at 20.”

In terms of High Net Worth Individuals (HNWI), or individuals having investable assets of US$1 million or more, Asia Pacific remains a global powerhouse. A report by Capgemini reveals that APAC generated 41.4% of all new global HNWI wealth and is on track to surpass US$42 trillion in HNWI wealth by 2025.

High Net Worth Individuals (HNWI), or individuals having investable assets of US$1 million or more, in Asia Pacific remains a global powerhouse.

Biggest Technological Trends That Will Disrupt Business

Over the last ten years, the scale of technological advancement has increased manifold. Brought about by the democratisation of data and hyper speed connectivity, we are now faced with a uniquely different set of challenges – or opportunities, depending on how you look at it – that will surely have an impact on how family businesses are being ran. In fact, according to a whitepaper recently released by J.P. Morgan entitled “Embracing Data, Digital and Disruptions: Planning ahead for Succession”, it revealed that “two thirds of family businesses indicate that technology advancement has altered business operations in the last ten years.” Looking at the current technological landscape, the next ten years would be absolutely game-changing.

Big Data Analytics

Big data refers to large sets of data obtained from multiple sources such as customer databases, business transactions, usage patterns, medical records and activity logs. Because of efficient management of data, companies can take advantage of operational efficiencies resulting in reduced costs and improved profitability. The challenge is with the democratisation of data, valuable information can now be easily obtained, and using the right tools, can be harnessed for monetisation purposes. Businesses that used to benefit from the exclusive possession of valuable data will now find themselves losing their leverage. In addition, due to existing laws and regulations, managing large volume of data now require significant infrastructure investments to ensure privacy and safeguards are in place.

Artificial Intelligence

Many business owners know that artificial intelligence (AI) has the power to alter the way they do business, either positively or negatively. Standing still, when it comes to AI adoption, is no longer an option. The bigger question is: HOW. Some organisations are slowly trying to adopt through the implementation of chatbots and other similar initiatives. But this is barely scratching the surface of AI. How will you define your AI strategy? How can you find AI-literate staff to fill in key positions of your organisation? How do you ensure the reliability and trustworthiness of your AI? These are just some of the questions, whose answers will create a cascading impact in the way wealthy families run their business.

Fintech

Perhaps one of the most consequential technologies we see of late is Fintech. A portmanteau of finance and technology, fintech represents a collision of two worlds that are locked in a tight embrace creating unprecedented disruption and synergies. We now see traditional banks being disrupted by neobanks or digital banks, whose customers don’t need to visit a physical branch to perform regular banking transactions. We see the rise of digital payments and how this mode of payment cuts away the middlemen. We also see governments recognising the growing impact of fintech in their economies and in response, creating laws and incentives to ensure its smooth implementation. The businesses of tomorrow will be impacted by fintech, one way or the other.

J.P. Morgan Surveys Present and Next Generation of Ultra-Rich Families

J.P. Morgan Private Bank, the industry’s most illustrious name when it comes to financial advice and solutions for wealthy clients and families, ran a survey of the current and next generation of business owners. The respondents span across 10 different countries in Asia whose annual turnover is less than $50 million to more than $1 billion. Its findings revealed that:

  • Decisions concerning the main family business continued to be made within the family: by the head of the family (36%), followed by the company board or a selected few (34%). Businesses with annual turnover of $1 billion and above were disinclined to entrust non-family executives with decision making powers.
  • Just over half (55%) of the next generation feel ready to confront technological disruption in the family business; amongst the next generation who did not feel they were prepared, more than half (56%) say they lack experience.
  • A large majority (87%) of current business owners say the family business has already experienced changes in the last decade; 85% felt the changes have been positive
  • A majority (80%) agree the family business will experience tech disruptions in the next ten years and a significant 92% in the 41-60 years age category agreed.
  • Technological disruption experienced in the last decade, and expected ahead vary across sectors: financial services, industrial, primary industries (mining, agriculture) were seen to be most disrupted; whilst real estate and construction, were seen to be least disrupted.

The two most cited priorities for how the next generation plan to restructure their family business are: investing in new technologies and professionalising management. For respondents from Southeast Asia, geographical expansion was a high priority, second only to investing in new technologies.


More than 50% of business successors are ready for future technological disruption. However, their self-rated readiness is a tad more pessimistic than current business owners, 67% of whom were of the view that the next generation leaders are ready for the future of technological disruption.

Two thirds of family businesses indicate that technology advancement has altered business operations and communications in the last ten years. A vast majority (87%) of the current generation of business leaders agree that the family business has changed in the way it functions in the last ten years, compared to 57% of the next in line business owners, an overwhelming majority (85) felt technology-led changes have been positive.

The most common cited outcome were: improved efficiency (75%); streamlined workflow (67%), higher productivity (57%), increased revenue and profitability (42%).

Two thirds of family businesses indicate that technology advancement has altered business operations in the last ten years.

Next 10 Years: 4 in 5 expect significant change

Four in five family businesses say they expect to experience “significant change” to the way their business runs due to technological advancements in the next 10 years. The respondents of age 41-60 years old were most inclined to agree, with 92% of this cohort holding this view, compared to 75% under 40 years old, and 79% above 60 years old.

Establishing Trust to Safeguard the Future

While wealth in Asia is still relatively low today compared to other regions such as Europe and North America, it is only a matter of time before the situation gets totally reversed. As the number of ultra-high net worth families in Asia continue to grow, and their investment needs become more complex which include multiple jurisdictions, the question of succession planning becomes all too important.

Succession planning is a long and complicated process. And while families realise the importance of adopting a holistic approach, the conversation must start early to create the life and legacy that you envision.

In Asia, Singapore remains one of the top financial and legal centres hence, the demand for trust companies, whose sole function is to administer wealth planning for succession, is on the rise. Just recently, J.P. Morgan announced the launch of J.P. Morgan Trust Company (Singapore) Pte. Ltd. (JPMTC SG), which will support J.P. Morgan Private Bank’s clients and their families in Asia.

“With the establishment of JPMTC SG, we will be in a better position to support clients who have complex wealth planning needs and serve a wider range of clients in one of the fastest, wealth-generating hubs in the world,” said Kam Shing Kwang, Chief Executive Officer for J.P. Morgan Private Bank in Asia and Vice Chair of Investment Banking for Greater China.

Ethan Chue, Head of J.P. Morgan Trust Company (Singapore) Pte. Ltd. added that, “By having a presence in Asia, we can service our clients and their families in the region more efficiently, and be more proactive in working with them to anticipate changes and plan for succession to future generations. It is important to address business and family needs in conversation, to get the structures right, and to work with a professional in order to get unbiased views.”

Building a legacy is a tall order. As the world evolves and technology continues to flourish, the amount of disruption these will create to your business will depend on how prepared you are in planning for the future. Like a double-edged sword, technology can enable you, or destroy you. It all depends on how you wield it and which team will be by your side, in order to emerge successfully. It’s absolutely no crazy thought that technology, harnessed correctly, can keep anyone crazy rich for a long time.

Succession planning is a long and complicated process. Conversation must start early.

***

Important information: The content of this report is provided for information purposes only. It does not offer any recommendation. It is very important to do your own research with due diligence before making any investment based on your own circumstances. Please note that we do all we can to ensure accuracy and timeliness of the information presented herein but errors may still understandably occur in some cases. If you believe that a serious inaccuracy has been made, please email info@digitalbankeronline.com. The Digital Banker accepts no responsibility whatsoever for any direct or indirect losses arising from the use of this report or its contents.

Download a copy of this report

How are the next generation in line going to confront technological disruption in the family business? Is proper succession planning in place? The Digital Banker investigates.
The Digital Banker provides custom content solutions for global financial services organisations, technology vendors and regulators. To learn more, email info@digitalbankeronline.com
Is Smart Risk Management the Future of Finance

Is Smart Risk Management the Future of Finance?

Over the past decade, risk management in banking has transformed dramatically. Brought about by an onslaught of new regulations that came on the heels of the global financial crisis, banks have now transformed their operations in order to comply and manage risks more effectively. In the coming years, the blueprint of what a bank’s risk function will once again undergo a sea change as fintech comes to fore.

For example, we have seen the rise of Bitcoin, along with many other cryptocurrencies using blockchain technology. Using a decentralised system, the idea being propagated by cryptocurrency enthusiasts is that people should be able to send and receive money, peer to peer, without any intervention by central authorities like governments or central banks. Once it happens, transactions will be faster, cheaper and supposedly, risk-free as full control belongs to the individual himself.

We’ve also seen the rise of neobanks or digital banks, whose physical branch is not necessarily a requirement for a customer to perform regular banking transactions. Due to competitive pressure, some of them have customised their offerings and processes to make their risk models more precise. As a result, they can undercut traditional banks, especially on price.

On the flip side though, traditional banks are collaborating with fintechs to explore new ways to undertake vital functions. Banks nowadays are using fintechs to help them handle credit risk underwriting, fraud detection and even regulatory compliance and reporting. Looking at the big picture, collaborating with the next generation of fintechs presents a more strategic benefit. And in the area of risk management, the potential areas of collaboration are aplenty.

In the coming years, the blueprint of what a bank’s risk function will once again undergo a sea change as fintech comes to fore.

The Future of Finance

One of the best approaches in striking a win-win situation between big banks and fintech start-ups is one that is both collaborative and incentive-driven. In the banking space, one of the loudest voices for this win-win approach is UBS through its Future of Finance Challenge.

UBS Future of Finance Challenge 2019 is an open competition for fintech start-ups and tech entrepreneurs around the world. Its goal is to find an innovative and potentially disruptive technological ideas and solutions that address specific challenges to support the transformation of banks for the future of finance. Part of this initiative are cash prizes and opportunities worth over USD $200,000 and 150 hours of dedicated coaching from UBS experts, mentors and partners.

UBS’s ambition is to help shape a more open and collaborative financial services industry and to jointly develop new innovative solutions for its clients. This open approach enables all stakeholders to embrace the pace of technological change and learn from entrepreneurs about products and services that will not only offer short-term gains but will also have a lasting benefit for banking customers and the industry in general.

While it can be hard to navigate the structures of large organizations, especially banks, UBS’s global reach and world-class banking expertise allows competition participants a unique point of entry, giving them the opportunity to test their ideas or develop them with a big bank’s support.

UBS’s ambition is to help shape a more open and collaborative financial services industry and to jointly develop new innovative solutions for its clients.

Transforming Banking through Smart Risk Management

Just recently, the Swiss multinational investment bank and financial services company announced the winner of UBS Future of Finance Challenge 2019 in Smart Risk Management. Using a novel technological approach to model and present regulatory obligations across a company, Solidatus was declared the winner.

Solidatus is an intuitive, simple to use web-based application that gives businesses the ability to rapidly map and visualise their data landscape. Unlike other expensive metadata applications, which require extensive work to be completed before it is usable, Solidatus starts building your data map immediately in front of your eyes.

In handing out the award, August Hatecke, Co-Head Wealth Management Asia Pacific, UBS Global Wealth Management; Country Head UBS Singapore, said, “In today’s complex and increasingly digital business environment, risk management is at the core of what we do. I am excited to see all the Smart Risk Management solutions presented to us today at the UBS Future of Finance Challenge Finals held in Singapore. We always strive to be the best risk-managed bank and look forward to collaboration with fintech startups and aspiring technology entrepreneurs to join us on this journey.”

“We always strive to be the best risk-managed bank (UBS) and look forward to collaboration with fintech startups and aspiring technology entrepreneurs to join us on this journey.”

Novel ideas for smart risk management never seem to run short. Aside from Solidatus, a roster of innovative companies has also presented solutions that smartly tackles risk management in areas such as due diligence, data sharing and digital compliance.

  • Enhanced Due Diligence. Neotas provides a due diligence tool that uses advanced technologies (Natural Language Processing (NLP), machine learning) and human insight to incorporate open source (web-based) data into the client due diligence process.
  • Digital Compliance Solutions. Apiax provides digital compliance solutions to companies faced with ever-rising amounts of laws, rules and regulations.
  • AI-Based AML Transaction Monitoring. Tookitaki is focused on AML transaction monitoring, using a combination of supervised and unsupervised machine learning to deliver real-time anomaly detection with actionable analytics and model explainability.
  • Secure Data Sharing. Sedicii’s solution allows for secure data sharing within Financial Institutions and between FIs, using cutting edge encryption methods.
  • Regulatory Tracking. Cube scans regulatory data globally and using AI, provides tailored and relevance-filtered updates to FIs, including impact assessments.
  • Enhanced Investigations & Analysis. Polixis’ tool allows for analysis of very large data sets, including entity resolution, and subsequent analysis to detect potentially fincrime-related anomalies for investigation.
  • Regulatory Compliance Evidencing. Solidatus uses a novel technological approach to model and present regulatory obligations across a company, to enhance transparency and assist demonstrating implementation and compliance.
  • Regulatory Tracking. Corlytics used AI-based text analysis and NLP to assemble regulatory information into defined categories, mapped to source regulators, to enable organisations to measure their regulatory risk.
  • Regulatory Tracking. Ascent automatically delivers targeted regulatory obligations and rule changes that apply to the customer, all housed in a cloud-based platform that enables end-to-end obligations management.

Formidable Partnership

In the end, the goal will always be about serving the best interest of the customer – and by doing so, the interests of the company and its shareholders are also served. Banks and fintechs forging an alliance for smart risk management is the future of finance. Anything less will be a missed opportunity. The seamless and simple apps that customers are used to, serves as a big draw that invites them to avail of more products and services. As customers’ expectations increase, the same level of service is also expected. This wouldn’t be a problem at all when a formidable partnership between banks and fintechs is forged right at the onset.

Banks and fintechs forging an alliance for smart risk management is the future of finance. Anything less will be a missed opportunity.

Important information: The content of this report is provided for information purposes only. It does not offer any recommendation. It is very important to do your own research with due diligence before making any investment based on your own circumstances. Please note that we do all we can to ensure accuracy and timeliness of the information presented herein but errors may still understandably occur in some cases. If you believe that a serious inaccuracy has been made, please email info@digitalbankeronline.com. The Digital Banker accepts no responsibility whatsoever for any direct or indirect losses arising from the use of this report or its contents.

Download a copy of this report

The winner of UBS Future of Finance Challenge 2019 in Smart Risk Management has been announced. Can Smart Risk Management transform banking?
The Digital Banker provides custom content solutions for global financial services organisations, technology vendors and regulators. To learn more, email info@digitalbankeronline.com
Are Digital Banks Winning in Today’s Economy?

Are Digital Banks Winning in Today’s Economy?

Visiting one’s bank used to be about the personal interaction and human touch. After all, banking is an exercise of trust.

But the rise of digital bank has redefined what is traditionally considered a bank. Today, ‘human touch’ has been replaced by the ‘touchscreen.’

Digital-only banks are creating a new set of differentiated customer experiences that give them a unique edge over traditional banks, leading to explosive growth in customer signups and interaction. Indeed, the rise of digital-only banks, from South America to continental Europe to Asia, which is now estimated to be more than a hundred, is expected to accelerate the integration of banking and non-banking supply chains and ecosystems.

Digital-only banks are creating a new set of differentiated customer experiences that give them a unique edge over traditional banks

There’s Banco Original and Nubank from Brazil. Germany has solarisBank, which is expanding into Asia, and N26 which has launched in the US.

China has MyBank and WeBank, the former backed by e-commerce giant Alibaba Group, while the latter was launched by conglomerate Tencent Holdings. There’s Digibank of India. Vietnam has Timo, Japan has Jibun Bank while South Korea has K Bank and Kakao Bank.

While most don’t offer a full suite of services, these challenger banks and neobanks are agile, with no burdensome legacy systems, unwieldy branches, and mostly unhampered by regulatory requirements. As such, they tend to move faster and grow quicker.

Here’s a look at some of the world’s major players.

N26

Based in Berlin, Germany, this application’s basic current account offers budgeting tools, spending insights and easy payments. Positioned as a traveller-friendly bank, it differentiates itself with insurance offerings, flexible workspace, hotels, and language-learning apps.

Using Mambu’s flagship core system on a software-as-a-service basis, N26’s customer base reached 500,000 in August 2017, quickly expanding into 17 European countries including Austria, France, Portugal, Ireland, Italy, Spain, and the Netherlands, a growth borne from its existing customers’ referrals.

On top of its free basic current account, it offers N26 Black and N26 Metal premium MasterCard. For a monthly fee of $7.30, the N26 Black card customers can avail of fee-free foreign currency automated teller machine (ATM) withdrawals worldwide. Allianz Global Assistance Europe also provides a comprehensive insurance package that covers travel, health, mobile phone or cash theft, as well as extended warranty for electronic devices. Beyond these perks, the N26 Metal card includes dedicated customer service, preferential rates and special partner offers.

It takes an average of 8 minutes to open an account that is concluded via a video chat with its customer support team. The downside comes with IDnow, its identity verification partner, that only supports certain passports and ID cards.

Valentin Stalf, founder and chief executive officer (CEO) of N26, expects to have a 5% to 10% share of the market in the main countries where it operates within three years.

Monzo

Based in UK, Monzo offers international payments without additional fees or charges, plus, no extra fees for up to GBP 200 withdrawals per month from international ATMs.

One of the fastest growing neobanks, standard features include budgeting, expense tracking, and international payments. Monzo also offers business banking that include SME loans, accounting, and administration add-in, and even insurance such as emergency cash for holidays, and mobile phone insurance.

Revolut

Another, UK-based neobank, London to be exact, Revolut boasts of the largest customer base and availability in 31 countries, quickly expanding to serve the youngest generation (8–18 years)
with Revolut Youth. It offers standard banking services, a pre-paid debit card, currency exchange, cryptocurrency exchange, and P2P payments.

Backed by robust venture capital funding, these neobanks’ main appeal especially to millennials, lie in their seamless customer experience and full-digital financial services at extremely low fees.
N26 is gaining traction in the strong European economies, now just hitting 3.5 million customers worldwide. Monzo is taking over the forerunning British market. While Revolut aims to break through the ten-million customer ceiling in 2020.

Are Digital Banks Profitable?

If you look at the explosive growth that digital banks are experiencing today, the answer is a resounding yes.

Most digital-only players in Asia have the backing of commercial banks. Vietnam’s Timo is powered by Vietnam Prosperity Bank. Japan’s Jibun Bank is a joint venture between Bank of Tokyo-Mitsubishi UFJ and the mobile network operator, KDDI. Indonesia’s Jenius was set up and funded by commercial banks.

Digital-only banks are transforming financial services. Although majority are still registering losses, a lot of them are expected to turn in profits soon.

In Singapore, as soon as the Monetary Authority of Singapore’s (MAS) announcement of issuance of up to five new digital bank licences was made, at least four companies have quickly expressed interest in applying for a digital banking licence – Singtel, Grab, Razer and InstaRem.

Hong Kong’s Monetary Authority (HKMA) has issued eight licences since March 2019 with 33 more pending applications. In South Korea, online only bank licences have been issued to Kakao Bank in 2017, operated by the country’s largest chat app.

A spokesman claims that “the 45 million monthly average users of our messaging app Kakao Talk is a huge plus for us when advertising our bank,” adding that the bank uses Kakao’s artificial intelligence technology for its automated customer support systems.

“Large technology companies are seeing this as a land-grab opportunity where they can build out new sets of financial services that can be cross-sold to their existing users,” McKinsey’s Hong Kong-based partner, Jeff Galvin, says.

James Lloyd, partner and APAC FinTech leader at consultancy EY says “what we are seeing in Asia
is technology companies moving sideways into finance, inspired by or even threatened by the examples of Alibaba and Tencent.”

“Large technology companies are seeing this as a land-grab opportunity where they can build out new sets of financial services that can be cross-sold to their existing users”

Traditional Banks Flexing Digital Muscle

Realising that millennials will become their lucrative clients in the future, traditional banks are launching digital banks of their own. On top of that, they are also adopting global best practices of their digital-only competitors such as provisions for personalised financial content, financial advisory blogs, financial calculators and more.

In fact, one of Singapore’s local banks, UOB, has recognised this early on and plotted a strategy around this whole notion of targeting millennials. UOB’s TMRW (pronounced as “tomorrow”), is the first mobile-only bank designed for ASEAN digital generation who prefer to bank on their mobile phones, anywhere and at any time. TMRW makes banking simpler, more transparent and more engaging for its customers by using data.

It translates transaction data into actionable insights to make the banking experience interesting and fun, while enabling its customers to be smarter at saving and spending. As customers spend more time with TMRW, the mobile-only bank becomes even more familiar with their wants and needs to serve them better.

As customers spend more time with TMRW, the mobile-only bank becomes even more familiar with their wants and needs to serve them better.

On the other hand, Taiwan’s Cathay United Bank (CUB) has fully embraced the digital intelligent era of payment reminding. In the past, CUB’s payment reminders had to rely on personal experience to judge the probability of default risks and sequence of reminding. By implementing digital innovation through the introduction of multiple data sources and machine learning technology, it was able to promote collaborative decision-making. About 30% – 35% of cases handled manually previously were converted into automated processing, thus, maximising reminding benefits and maintaining CUB’s competitive advantage in the market.

The efficiency of payment reminding for consumer financial products has been greatly improved by its digital transformation. As a result, the bank was able to: a) map out intelligent payment reminding strategies with intelligent analysis of customer behaviour; and, b) empower employees with data analysis capability to implement data-driven strategies.

Not to be outdone, Krungsri has launched “Krungsri GIFT”, a revamped loyalty programme derived from customer insights that aims to enrich customer experience, acquire new customer segments, and sustain the growth path of the bank in the digital landscape. Krungsri GIFT raises the bar on customer loyalty by creating omni-channel experiences and leveraging big data to offer instant rewards to customers who complete four types of transaction: deposits, withdrawals, transfers, and payments. Following insights from customer analysis of main bank users’ behaviour, this innovative customer loyalty programme was designed to convert occasional users to main bank customers.

Striking a win-win

As digital banks grow, expect the competition to heat up. For sure, big banks will not take things sitting down. But instead of knocking each other out, possibly one of the best approaches in striking a win-win situation between traditional banks and digital-only banks is by being collaborative and synergistic. In which case, the ultimate winner will be the customers.

>> To read more about this story and other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.

The Digital Banker - Serving Tomorrow's Customers

Banks, FinTechs and the Way of the Future

In what could be considered as the largest gathering of power players in the retail banking industry and the fintech world, CEOs, founders, tech innovators and challengers of all stripes gathered to discuss the future of global banking at the 2nd Annual Global Retail Banking Innovation Summit and Awards.

Held on 26 September 2019 at the Carlton Hotel in Singapore, more than 200 delegates from different parts of the world paid close attention to the clash of ideas happening on stage as incumbent banks tackle the impending impact of digital banking to their core business model and how, by innovating, this could be a big win for both its customers and shareholders.

On the other hand, challengers of the status quo such as neobanks, digital banks and virtual banks made the case for faster, cheaper and arguably more exciting way to do banking in the future as they map out plans and strategies to reach more customers and achieve profitability.

Challengers of the status quo such as neobanks, digital banks and virtual banks made the case for faster, cheaper and arguably more exciting way to do banking in the future.

Incumbents vs Challengers

The competition between the so-called incumbents and challengers reached a fever pitch in June of this year when Senior Minister Tharman Shanmugaratnam announced that up to five new digital bank licences will be issued by the Monetary Authority of Singapore (MAS) comprising up to two digital full bank licences and up to three digital wholesale bank licences.

Singapore, which is now the most competitive economy in the world, dislodged the United States in the recent global rankings. This latest move to issue up to five new digital bank licenses in Singapore will put the banking liberalisation into hyperdrive and could potentially be a game changer not only in the ASEAN region but in other regions as well.

The session was opened by Bain & Company where the Top 10 Predictions for the Retail Banking Landscape in 2020 was shared. In this presentation, Bain & Company revealed some of the key findings of their research on digital financial services in Singapore including potential revenue pool shifts, winners and losers as well as success factors for a digital/neo bank.

He was then followed by Bidyut Dumra, Head of Innovation at DBS where he discussed the importance of collaboration for financial institutions through Open Banking. Topping the Asia Pacific region when it comes to open banking readiness, Singapore is poised to take the lead in this space. And as the country’s largest bank, DBS is well-positioned to extol the virtues of Open Banking. Mr. Tekchandani took the opportunity to share the six pillars of Open Banking to make collaboration possible as well as practical strategies to put plans into action.

Wavemoney’s CEO, Brad Jones then took the stage to talk about the importance of financial inclusion, particularly, in how they successfully did it in Myanmar. Having covered 89% of the Myanmar market, Brad shared the challenges and payment nuances in Myanmar and how they were able to address these challenges – lessons which can aptly be applied across different markets in Asia.

What came next was probably one of the most fascinating highlights of the entire conference as key officers from challengers and traditional banks hit the stage for a CxO Power Panel. Anurag Mathur, Head of Retail Banking & Wealth Management at HSBC Singapore, Jakub Zakrzewski, General Manager at Revolut, Chris Davison, Co-Founder at Big Pay, and Pedro Sousa Cardoso, Global Head of Digital Commerce at Standard Chartered Bank all presented valuable insights on the emergence of digital banks and how the incumbents are responding to these challenges.

Can Innovation Co-Exist with Regulations?

One interesting topic of discussion is whether regulations is stifling innovation, especially as it mostly covers traditional banks and not necessarily the fintech companies. HSBC’s Anurag Mathur put things into perspective by highlighting that regulations have been there to protect customers. In Singapore’s case, the Monetary Authority of Singapore (MAS) has, in fact, encouraged innovation by setting up a FinTech Regulatory Sandbox and other similar programs to advance the welfare of the industry.

Revolut, being one of the most popular fintech in the panel and also boasts of a large number of user base was asked the inevitable question by the moderator, Namita Bhide, Founder of Denim Consulting: Will Revolut apply for a digital banking license in Singapore? Revolut’s Jakub Zakrzewski expressed optimism with the Singapore market and how Revolut could address a specific need, however, was non-committal to provide a straight affirmative or negative response.

In Singapore’s case, the Monetary Authority of Singapore (MAS) has, in fact, encouraged innovation by setting up a FinTech Regulatory Sandbox and other similar programs to advance the welfare of the industry.

Other Presentations include:

The Future of Retail Banking – How Everything and Nothing Has Changed
By Aizuddin Danian, Head, Digital Banking at Standard Chartered Bank

Hardwiring CX to financial performance in the FSI sector
By Tom Mouhsian, Principal Analyst (CX) at Forrester

ASEAN’s Digital Bank for ASEAN’s Digital Generation – A Case Study on How UOB Built an Award-Winning Digital Bank in Thailand
By Stuart Smith, Regional Head of Engagement & Design at TMRW by UOB

How Non-Banks Harness Tech to Disrupt the Digital Banking Landscape
By Jasmine Ng, CEO at Razer Fintech

The Revolut Journey – Past, Present & Future
By Jakub Zakrzewski, General Manager, Singapore at Revolut Inc

Awards Gala Dinner

In the evening, the Awards Gala Dinner was held celebrating the best-in-class retail banks in the world. The Global Retail Banking Innovation Awards 2019 received over 400 submissions from banks who are at the forefront of innovation and continue to bring superior products to the market. Among the most coveted awards given were: Retail Bank of the Year, won United Overseas Bank Limited; Retail Banker of the Year, won by Anurag Mathur of HSBC and CEO of the Year, won by Piyush Gupta of DBS. The highly prestigious Best Bank in the World was won by DBS for being digital to the core and customer obsessed while maintaining a start-up culture through and through.

>> To read more about this story and other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.