The Impact of US-China Relations on Wealth Management

The Impact of US-China Relations on Wealth Management

On 3 November 2020, the United States electorate will head to the polls to decide who will lead the world’s most powerful nation in the next four years. As Donald Trump and Joe Biden battle it out to be the chief architect and implementer of US foreign policy, one issue looms large, and unsurprisingly, a crucial talking point in the election: China.

Of particular interest by economists, as well as wealth managers around the world, are the issues concerning trade and investment.

In 2018, China saw a huge increase in tariff on imports to the US. This is a calculated effort from the Trump administration to force Beijing to reduce subsidies on manufacturing companies based in China and curb their difficult demands on US companies.

In January 2020, the two countries came to agreement by signing a trade deal which knocked back some of the tariff rates but failed to address the major issues. This was after an entire year of back and forth on tariff which considerably slowed and depreciated the economy on a global scale.

Nonetheless, Beijing has promised to increase import of US goods worth 200 billion dollars in the space of twenty-four months.

In the meantime, the US government is pushing to have American companies cease manufacturing and sourcing of materials from China. 

US Companies’ Reaction to Trade Issues

These new restrictions have predictably caused US companies untold tension and pessimism. Every day, the chances of the trade tensions reducing or ending grows slimmer because neither Beijing nor Washington are showing signs of relenting. None of the companies are looking forward to the threat of moving their companies over to the States.

The American Chamber of Commerce based in Shanghai conducted a survey and released the results of their findings. Ninety-two percent of the respondents agreed that they would rather keep their companies in China despite the persistent fracture in the US-China relations.

The survey revealed that over a quarter of these firms are aware that the dispute between China and US may last indefinitely. A year ago, only 17% agreed to that possibility. In 2019, 13% of the companies believed that the issues would be settled with three to five years, a number that has since increased to a fifth of the respondents.

However, about 14% agree that the issues will be over in about twelve months.

In a quote, AmCham Shanghai stated that, “What is likely underpinning this sense of negativity is concern about broader US-China relations.” An opinion that outlined responses from over three hundred and forty companies.

The said survey was conducted from June to July when the conditions seemed to worsen even after a trade agreement by both countries.

About 1400 companies in China participate in the yearly survey conducted by the American Chamber of Commerce in Shanghai, an NPO (Non-Profit Organization) that strives to bridge the thorny trade gap between the US and China.

Currently, relations between China and US have continued to sink to a historic low as they continue to disagree and punish each other from issues ranging from the Coronavirus pandemic to technological control.

Donald Trump severed the special trading relationship in July between US and Hong Kong. That privilege had formerly exempted Hong Kong from some tariffs. In additions, both countries made moves to shut down their consulates in Chengdu and Houston.

By August 2019, Washington issued a sanction to Chinese government officials citing that they undermined Hong Kong’s autonomy, with Carrie Lam – the leader – inclusive.

When suspicions rose that TikTok and WeChat could be used to spy on the US government, Donald Trump issued threats to ban the popular apps from the US.

While 32% of the respondents agree that the bad relationship between the countries is sourly affecting their ability to keep their staff, they know that leaving China is completely out of the question. Even with Trump’s order to leave the country in 2019, and in recent weeks, played around with the idea of “decoupling” the world’s largest economies.

These companies state that China still provides several benefits. For instance, some firms are focused on tapping into the large number of middle-class citizens. While many others rely heavily on China for manufacturing. According to 2020 AmCham survey, the number of companies that said China aided the growth of their profit margin increased from 9.4% to 32%.

In agreement to the above data, President of AmCham in Shanghai, Ker Gibbs said, “US businesses in China would like to see the two countries resolve their outstanding issues quickly and reduce tensions.” Gibbs stated, “A workable cooperative framework for the next decade would be a good place to focus discussions.”

The Long Term View

The relationship between US and China is reaching a dangerous point. The already fragile relationship is on the brink of total collapse and we could only hope that in the coming days, the relationship could improve for the better. People from all over the world are pinning their hopes that the coming 2020 US presidential elections will provide a pathway for calmer, more collaborative partnership between the two great powers. As a famous world leader once quipped: “The forces that divide us are not as strong as those that unite us.”

 

Image: Andrea Izzotti / Shutterstock.com

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>> 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.

TDB Digest

TDB Digest – What’s Cooking in the FinTech and Banking Industry (Issue 14)

DIGITAL BANKING

Greenwood closes a $3 million seed round

Greenwood recently announced that it had closed a $3 million seed round from private investors to build an online banking platform for Blacks and Latinx. The initial products that Greenwood will offer are savings and spending accounts, black metal debit card with features such as Apple, Samsung, and Android pay, virtual debit cards, P2P transfers, free ATM usage among others. All deposits are FDIC insured and Greenwood plans to partner with “brick and mortar minority-owned banks” to empower historically black banks as well as the black and Latinx community. One of ways its plans to address the lack of fairness in the financial system is to provide a $10,000 grant every month to a Black or Latinx small business owner that is a Greenwood customer. Founders of Greenwood include, Andrew J. Young – former U.S. Ambassador to the United Nations and an activist, Michael Render – rapper and activist in Black financial empowerment and Ryan Glover – founder of Bounce TV network.

STRATEGIC PARTNERSHIPS

Mastercard and Marqeta extend their partnership

Mastercard, a global payments business and Marqeta, an open API card issuer and payments processor recently announced that they extended their global partnership. With this partnership, the two companies plan to expand to new markets and launch card programs together. As part of their expansion plans, Mastercard and Marqeta plan to expand to Asia Pacific, and several other markets. Mastercard will also make an undisclosed financial investment in Marqeta. The two companies have a history of working together since 2014. They have collaborated and “helped fintechs, digital banks and commerce disruptors across North America and Europe bring innovative card products to market.”

Standard Chartered Bank Singapore partners with Moneythor to launch SC Money Manager tool

Standard Chartered Bank Singapore has partnered with Moneythor, a leading digital banking software provider to deliver an all new AI-powered data-driven personal finance management tool – SC Money Manager. This tool aims to provide AI-powered data analysis of a customer’s personal finance management by deploying Moneythor’s data-driven engine and its API. Customer will now be able to make informed decisions based on their historical trends and patterns and will also have access to insights on expenditure and income among other features, all within the Bank’s flagship mobile banking app. Nauman Bashir, Managing Director, Head of Digital Banking Singapore, ASEAN and South Asia Digital Transformation at Standard Chartered, commented: “We are committed to delivering a best-in-class digital experience to support our clients’ digital banking needs and also their ongoing aspirations to better manage their finances. Through our partnership with Moneythor, we can deliver this in a comprehensive package by making the banking experience more intuitive and personal, and less transactional.”

FINTECH FUNDING

Joko raises €10 million Series A funding round

Joko, a Paris based Fintech, recently announced that it raised €10 million Series A funding round. Leading the funding round were two French venture capitals, Partech and Axeleo Capital who had earlier participated in the seed round too. Joko aims to disrupt cashback rewards and has already partnered with over 1,000 retailers via its platform and boasts of over 500,000 users. The start-up is poised to leverage Open Data initiative enabled by PSD2 (Payment Services Directive 2) by allowing shoppers to connect their bank card to Joko’s app or browser extension. Joko users have now collected over €1 million in cashback from brands such as Carrefour, H&M, Asos, Apple and Nike.

RazorPay secures $100 million in Series D funding round

RazorPay, a full-stack financial solutions company, recently announced that it secured $100 million Series D financing and also achieved the unicorn status. This funding round was led by GIC, Singapore’s sovereign wealth fund and Sequoia. Existing investors such as Ribbit Capital, Tiger Global, Y-Combinator and Matrix Partners also joined the Series D round. Having built an advanced payments infrastructure, Razorpay now connects consumers with businesses and accepts payments across multiple channels – whether online, through links, via self-hosted pages or third party branded stores or through a QR code. Razorpay serves global brands such as Facebook, Google and Wikipedia, and domestic brands like Jio, Zerodha and Hotstar along with a host of SMEs and freelancers.

5 Resilient Fintech Companies and What Makes them Durable

5 Resilient Fintech Companies and What Makes them Durable

Financial technology, commonly referred to as ‘Fintech’, has gained rapid growth in the tech industry in recent years.

Fintech refers to all companies or startups established primarily to solve all finance-related problems in the finance industry, utilizing modern technological devices and techniques.

Let’s check out ten fintech companies that have shown resiliency amidst tough environment and the strengths that will carry them through into the future.

1. TransferWise

TransferWise is one of the most famous fintech companies in Europe. It offers its clients a way of making transactions from different parts of the world using its peer-to-peer money transferring service.

TransferWise supports different currency accounts. It also permits up to 750 currency pairs such as USD-AUD, USD-GBP etc. Between 2013 and 2017, it raised a whopping sum of $109 million from business capital giants like Andreessen Horowitz and Richard Branson.

TransferWise recorded its first 4 million users in 2018 and marked it with a profit of $8 million. The company has grown to be among the first five most valued fintech companies in Europe.

2. Chime

Chime is a neobank company based in the United States. The company provides banking services to clients but surprisingly doesn’t charge a fee for maintenance of an account. It gets a greater percentage of its revenue from interchange collections which it charges retail business owners for card transaction processing.

The company was established in 2013 and attained its one million account mark in 2018. By 2019 end, it already had 6.5 million accounts under it. According to data by Crunchbase, the company over the years has been able to raise more than $800 million in funds.

3. Ant Financial

Ant Financial is regarded as one of the most prominent fintech companies worldwide. It is located in the Hangzhou city of China. Ant Financial is the owner of several leading financial services such as Yu’e Bao which is the world’s third-biggest money market fund and Alipay a heavyweight online payment platform.

The company runs the Sesame Credit (a private credit evaluation system). Alipay used to be a subsidiary of the Alibaba Group, but in 2014, it got rebranded into what is known today as the Ant Financial Services.

Ant Financial in 2015 secured a $6.5 billion investment deal from investors such as China Investment Corp and other local investors. In 2017, It was valued at $60 billion. Currently, this company has value more than the market capitalization of many leading global banks.

Ant Financial in 2015 secured a $6.5 billion investment deal from investors such as China Investment Corp and other local investors. In 2017, It was valued at $60 billion. Currently, this company has value more than the market capitalization of many leading global banks.

4. Stripe

Stripe offers services that enable users to process their payments without much stress. The company which was established in 2011 got its first major investment from the co-founder of PayPal, Peter Thiel. It was a $2 million investment. Just after one year of establishment, it achieved a $100 million valuation.

In September 2019, Stripe received a $35 billion valuation from notable venture funds such as General Catalyst and Sequoia Capital. The fact that they run on a highly technologically advanced system has placed them ahead of others.

5. Coinbase

Recall that there was a boom in the cryptocurrency market in 2017; that was what put Coinbase on the spotlight. Coinbase has grown to emerge to be the world’s biggest digital currency exchange today. The platform is famous for trading digital currencies such as the popular Bitcoin and the more recent Ethereum as well as Litecoin.

The company has raised not less than $217 million in funding since its establishment, and in 2017, it made a revenue generation of over $1 billion. Obviously, the fate of the company is intertwined with the future of digital currencies.

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>> 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.

TDB Digest

TDB Digest – What’s Cooking in the FinTech and Banking Industry (Issue 13)

DIGITAL BANKING

Bank of America launches a new digital solution – Life Plan

Bank of America recently launched Life Plan – a new digital experience integrated with its mobile and online banking platform. Life Plan allows the bank’s customers to set and track goals such as finances, family, health, home, work, leisure and giving, adjust these goals in real-time and also avail advisory services by scheduling in-person or virtual appointments with the bank’s financial professionals. Life Plan is powered by Erica – BofA’s AI-driven virtual financial assistant, Preferred Rewards – the bank’s loyalty program and is available in two languages – English and Spanish. David Tyrie, Bank of America head of Digital, Financial Center Strategy, and Advanced Client Solutions said, “Life Plan delivers a personalized experience for every client, providing information that is timely and relevant, aligned to their unique financial goals, and offering a choice of the next best step.”

Step – a bank for teens, launched its banking app

Step, a financial services start-up providing banking services for teens and families, officially launched their banking app last week. Step offers its customers a free FDIC insured bank account which can be opened by providing basic information, a customisable Visa debit card and eliminates all banking fees. At the end of the sign-up process, teen customers will be able to invite their parents to download the app, where parents can unlock the debit card for regular use by their children. According to CJ MacDonald, founder and CEO at Step, “They (teens) expect to manage their money in the same way as their social media but banks have failed to keep up––largely overlooking this generation and their unique needs. Step was built to fill this gap, providing modern financial tools that enable teens to easily manage their money while helping to improve their financial literacy at an earlier age.”

 

FINTECH FUNDING

PayMongo rasies $12m in Series A funding round

PayMongo, a Filipino payments startup, recently announced that it raised a $12 million Series A round led by Stripe. Existing investors Y Combinator and Global Founders Capital and new investor – Bedrock Capital joined Stripe bringing the total investment of the Series A to almost $15 million. Francis Plaza,CEO, PayMongo said, “This new funding will be invested in expanding our products and services, as we build out a much bigger financial infrastructure. There’s still a lot of work to do: from adding more payment options to supporting new business models such as recurring payments, subscriptions and invoicing.”

 

CROWDFUNDING

Clim8 launches crowdfunding campaign

Clim8, a fintech which provides investmentsinsustainable portfolios, recently launched its crowdfunding campaign. The campaign, powered by crowdcube, raised over £560,000 in just 24 hours. Clim8 will soon launch its mobile app which will allow investors to create sustainable investment portfolios. Clim8 aims to introduce conscious investors to its carefully selected companies already making a positive impact on climate change. Companies working in sectors such as clean tech, smart mobility, recycling, clean energy among others will be available on the Clim8 app.

 

DRIVING SUSTAINABILITY

Starling Bank, a United Kingdom-based digital bank recently partnered Trillion Trees, a joint venture between BirdLife International, Wildlife Conservation Society (WCS) and the World Wide Fund for Nature (WWF) to plant trees. With this initiative existing Starling Bank customers can refer as many people as they like. For every successful new customer referral, Starling Bank will donate to Trillion Trees who will plant one tree.

How can a bank achieve a truly customer centric approach in 2020

How can a bank achieve a truly customer centric approach in 2020?

Re-imagining customer segmentation, introducing multiple touch points and personalized services will unlock value for customers in 2020 and beyond.

 

Customer centricity is intrinsic to every service industry and retail banking is certainly no exception to this rule. Stepping in 2020, customer centricity has infinitely grown due to the pandemic. Most, if not all banks, noticed accelerated use of digital channels among its customers as Covid-19 evolved from an epidemic to a pandemic. Banks have reported active use of digital channels this year with one of the major banks in Singapore (OCBC Bank Singapore), reporting a 40% surge in online transactions conducted by customers between the ages of 50 and 64. This is a clear indication of how customers are truly willing to adapt and evolve.

Fundamentally speaking, traditional customer segmentation (age, gender, socio-economic group, region, etc) has allowed banks to target customers and cross sell products and services which generate revenues for the bank. However, this approach is slowly evaporating and is  being replaced by behavioural data usually related to customers’ spending habits. For a bank to become customer centric, approaching customers based on their spending and saving habit is more viable. Another area where we see customer segmentation, is the mode or channels via which products and services are offered to the customers. While customers have always craved for an experience which offers the best of both worlds – digital interaction and in-person branch banking, retail banks have to re-imagine banking and capitalise on a multiple touch point offering. This will allow customers to reach out to banks through channels, be it the internet, on mobile, through social media, employing the direct messaging services or availing the assistance of chatbots or calling services. The use of these channels will blur customer segmentation, thereby engaging a wider pool of customers.

For a bank to become customer centric, approaching customers based on their spending and saving habit is more viable.

A multiple touch point approach ensures interest of the customers, however, the need of the customers has rapidly evolved today. By this we mean, customers crave for more than just mundane transaction services, interest on savings or current account flexibility. Customers now want banks to help them save, offer insights into spending habits, provide wealth management advice and services, recommend insurance solutions and reward them points for engaging with the bank. This personalization, if not hyper-personalization of services is currently influencing a customer’s choice of bank. The extensive use of data analytics, deploying artificial intelligence and machine learning can provide a customer with such insights at his/her fingertip.

Scalability to offer products and services which revolve around a customer’s needs, while ensuring an omni-channel service, a multiple touch point strategy and technology driven approach, is going to lead a bank towards a customer centric business. Adoption of technology, automation of processes and digitisation of products and services will drive customer retention as well as grow customer acquisition. However, according to PwC Retail Banking Overview 2020, “61% of bankers say a customer-centric business model is “very important”. Only 17% are “very prepared for it.” These numbers augment the immediate need for banks – especially retail banks to transform themselves into customer centric organizations.

Scalability to offer products and services which revolve around a customer’s needs, while ensuring an omni-channel service, a multiple touch point strategy and technology driven approach, is going to lead a bank towards a customer centric business.

TDB Digest

TDB Digest – What’s Cooking in the FinTech and Banking Industry (Issue 12)

FUND RAISING

Greenlight raises $215 million in Series C funding

Greenlight, a start-up which issues debit card for children via an app managed by parents, recently raised an additional $215 million investment in Series C round. The lead investors for this round were Canapi Ventures and TTV Capital. Greenlight’s first institutional investor Relay Ventures also participated along with other new investors – BOND, DST Global, Goodwater Capital and Fin VC. Greenlight is a unique money-management platform which enables parents to pay allowance to their children and offers additional features such as managing chores, set parent-paid interests on the child’s savings and more. The platform plans to use this funding to “provide new ways for kids to learn about the world of money.” The company also plans to introduce new investing tools for kids in the coming months.

Robinhood increases Series G round to $660 million

Robinhood, a US based trading start-up,added $460 million to its Series G round bringing it to a total of $660 million. In August, the start-up had raised Series G round of $200 million from D1 Capital Partners. This additional funding of $460 million is bought in by Andreessen Horowitz, Sequoia, DST Global, Ribbit Capital and 9Yards Capital. A company spokesperson told Reuters: “We’ve raised an additional $460 million in subsequent closings to our Series G to support our core product and customer experience and new offerings like cash management and recurring investments.”

Syfe raises $18.6 million in Series A funding

Syfe, a Singapore-based digital wealth manager, raised USD18.6 million Series A round led by Valar Ventures. Other participating investors included Presight Capital and existing investor Unbound. Syfe is licensed by the Monetary Authority of Singapore to offer fully managed investment portfolios without a minimum investment, based on an investor’s risk profile, investment objectives and goals. According to the Syfe’s press release, “The funds will be used to enter new markets, develop new products and services, hire top talent, and enhance Syfe’s technology platform to continue delivering exceptional user experiences.”

 

BLOCKCHAIN INITIATIVES

Ant unveils an international trade finance platform – Trusple

Ant Group unveiled Trusple – a trade finance platform powered by AntChain, Ant Group’s blockchain solution providers to enterprises, developers and public sectors. Trusple, built on the motto ‘Trust made Simple’, aims to provide end-to-end digital trade finance, smart payments and financing solutions to various organisations. This digital initiative will aid easier and faster cross-border trade with small and medium enterprises being the largest beneficiaries.

 

SUSTAINABLE FINANCE REPORTING

Standard Chartered published its first annual Sustainable Finance Impact report

Standard chartered recently published its first annual Sustainable Finance Impact report highlighting that “91% of sustainable finance assets were located in emerging markets and 86% in some of the world’s least developed nations.” It also disclosed that USD 3.9bn of Sustainable Assets were linked to UN’s Sustainable Development Goals (SDGs) and further elaborate on the impact of the EUR 500m Sustainability Bond of July 2019. Simon Cooper, CEO, Corporate, Commercial & Institutional Banking said: “Our natural footprint as a Bank means that we are providing finance in emerging markets where the need for funding as a positive catalyst for change is greatest. For example, financing of solar projects in India will help avoid over seven times the CO2 from a similar-sized project in France, given the current sources of power on those countries’ grids.”

Taipei Fubon Bank’s Futuristic Wealth Management- ‘Smart Investments’

Taipei Fubon Bank’s Futuristic Wealth Management- ‘Smart Investments’

Banks & Financial institutions are increasingly deploying new technology to succeed in the age of technology. However, Taipei Fubon Bank’s vision is to use digital technology to make its clients succeed.  It has an intense focus on keeping Customers-First and ensuring that technology is used to deliver more effective, easier-to-use and faster financial services & solutions to customers.  Taipei Fubon Bank President- Roman Cheng- never gets tired of pointing-out that it is not about technology, it is about creating strong UVPs and delivering great customer experiences.

This approach has led to many innovative products in recent years that have been recognized not only for the latest technology but, more importantly, for popularity with customers and resulting high usage rates.  One of these innovative products is Taipei Fubon bank’s recent flagship offering for Wealth Management customers- ‘Smart Investment’.

Smart Investment platform helps customers make better financial choices by enabling them with financial data & digital technology.  Customers can use the ‘Smart Investment’ platform to create financial plans suited to their individual needs as well as help them decide how to maximize portfolio returns by using low interest loan to invest in higher yield investments. This innovative offering is already in use by about 18K WM customers– an impressive achievement for a new product in a highly competitive Taiwan market.

Taipei Fubon Bank has been leading the new trends in Wealth management & Private banking in the last few years; and has received several recognitions for its customer focus and use of technology. Global Private Banking Innovation Awards 2020 (GPB Awards) by The Digital Banker recently recognized Taipei Fubon Bank with three major awards- the Best Private Bank, and the best private bank in AI & Big Data respectively.  Moreover, Taipei Fubon bank was adjudged ‘Highly Acclaimed’ in two more categories- Best Private Bank for Client Experience and Outstanding Technology Implementation (Back End).

“Taipei Fubon Bank is known for its tenacity in providing exceptional service to its customers. Using its core strength in technology to boost its business and serve its customers in a manner that provides great value, they have proven once again that they are second to none.”

The Global Private Banking Innovation Awards 2020 (GPB 2020) organized by The Digital Banker are highly regarded and valued in wealth management industry.  GPB Awards are judged by private wealth industry leaders and are aimed to identify and recognize the world’s best in class Private Banks, Family Offices and Wealth Managers that demonstrate elite levels of performance & creativity across Fixed Income, ESG, Structured Investments, Family Office Services, Discretionary Services, FX & Cash Management, Funds, UHNW, Islamic Finance and more. This year’s panel of judges include subject-matter experts known for their integrity and unbiased adjudication from companies such as Forrester, Protiviti and EY.

Power of AI/ ML for WM customers-‘Smart Investment’

Smart Investment platform is based on two major technologies.  Firstly the algorithms to generate & evaluate multiple scenarios and arrive at best choices for each individual customer.  The second is an automated platform using artificial neural network to detect customer repayment information & deliver timely alerts to customers.  ‘Smart Investment’ is a simple-to use but powerful platform that is able to assist all customers including those without any investment background to start on their financial management journey.

This app, the first of its kind in Taiwan, gives customers automated advice on multiple aspects of financial management. The goal is to provide relevant information to help clients in making sound financial decisions.  ‘Smart Investment’ integrates to mobile and online banking channels and constantly reviews customers’ data such as loan amount, interest payments, remaining instalments, etc.  Smart Investment is then able to recommend the best options available for each customer.  In addition, the alert system built into the Smart Investment platform gives Taipei Fubon Bank the ability to detect important issues that need urgent attention.

Taipei Fubon Bank’s nearly 18,000 customers with AUM of USD 1bn are already making better financial planning decisions through this ‘Smart Investment’ app.  These usage numbers continue to grow with more & more customers adopting the smarter way to investing!

‘Smart Investment’ is a digital application that even assists customers without any investment background to start their financial management journey.

Prosperity Across Generations 

In 2018 Taipei Fubon Bank launched the Exclusive Banking Group- a new client-centric service model catering to top-tier clients.  Based on results of customer research & insights from HNW Private Banking customers, a unique brand was created– “Prosperity Across Generations”.

Taipei Fubon Bank believes that HNW clients need the same level of service & products as corporate clients and aims at serving HNW individuals as “corporates”. Increasingly Bank’s high net worth clients, just like corporates, face complex challenges for asset and wealth management. Simple services like family asset management are necessary but no longer sufficient for the needs of these HNW clients.

Taipei Fubon Bank assists high net worth clients using a comprehensive service approach that includes both the “upstream” and the “downstream” opportunities to offer a complete investment ecosystem to its customers.

In another first for any bank in Taiwan, Taipei Fubon Bank collaborates with Lombard Odier, a 224-year-old Swiss private bank, to provide the world’s best private banking services to its customers.  With client-centric focus, investment in technology and expertise of its well-trained bankers, Taipei Fubon Bank has rapidly developed itself into a world-class provider of private banking services exclusive clients in Taiwan.

“Prosperity Across Generations requires wealth management with relevant information, timeliness and global perspectives for our clients. Taipei Fubon Bank is focused on providing these to its customers so that they can focus on their own businesses and families.”

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>> To download the print magazine version of this article, click HERE.

>>To read more about this story and other exclusive features about the global private banking landscape, download the latest issue of Global Private Banker Magazine HERE.

TDB Digest

TDB Digest – What’s Cooking in the FinTech and Banking Industry (Issue 11)

VIRTUAL BANKING

Mox Bank, a virtual bank backed by StanChart, is now available for everyone in Hong Kong

Mox Bank, a virtual bank in Hong Kong backed by Standard Chartered, in partnership with HKT, PCCW and Trip.com, is now available for everyone in Hong Kong. Five months ago, Mox invited select customers to try its services all the while helping refine it. One week ago, it started onboarding pre-registrants who signed-up for its waitlist and also started sending out limited-edition metal Mox card. Within a span of a week (22nd September 2020), Mox has opened its virtual doors to the whole of Hong Kong. It is also the first virtual bank in Hong Kong to support both Apple Pay and Google Pay. Mox customers can use their “digital wallets, make regular payments, get real cash back to their accounts, while earning daily interest.”

 

FUND RAISING

TrueLayer raises $25 million in Series C funding

TrueLayer – an open banking start-up in the UK recently raised an additional $25 million investment in Series C round. The additional investment came from exiting investors. The start-up in 2018 was given the green light by Financial Conduct Authority (FCA) “to provide account information and payment initiation services under Open Banking and PSD2”. Ever since then TrueLayer’s platforms and products account over 50% of all Open Banking traffic in the UK. This round of funding will allow TrueLayer to “build financial connectivity that’s open to everyone, power the development of new financial services in new geographies, and give people more control over their financial lives.”

Affirm raises $500 million in Series G funding

Affirm, a flexi payment alternative to credit card, recently announced that it raised $500 million series G round of funding. The funding round was led by GIC, a returning investor, and Durable Capital Partners LP. Apart from this, other existing investors included Lightspeed Venture Partners, Wellington Management Company, Baillie Gifford, Spark Capital, Founders Fund, and Fidelity Management & Research Company LLC. With this capital infusion round, Affirm hope to “better support merchants who offer smaller ticket items and bring their customers a more transparent, flexible way to pay.”

Chime raises $485 million Series F funding

Chime, a US challenger bank, recently raised $485 million in Series F funding round. With this round Chime is valued at $14.5 billion, as reported by CNBC, making it the most highly valued (private) startup. The startup provides banking services via mobile app and a website. A new customer can apply for a bank account takes less than 5 minutes and can also avail a Visa debit card without any costs. CEO of Chime – Chris Britt told CNBC, “We’re more like a consumer software company than a bank. It’s more a transaction-based, processing-based business model that is highly predicable, highly recurring and highly profitable.”

 

IMPACT INVESTING

Citi Impact Fund – a $150 million fund – recently announced its first four investments

Citi Impact Fund – a $150 million fund, created to “double bottom-line” while having a positive impact on society, recently announced its first four investments. The companies which are beneficiaries for the investments are, Fulcrum BioEnerg, ICON, PadSplit and The Mom Project. These companies demonstrate features such as existing customer base, previous funding rounds, while solving problems which are beneficial to societies and the environment. Ed Skyler, Head of Global Public Affairs at Citi said, “These companies have created distinct approaches for what’s possible as we address some of the biggest challenges we face today, such as creating affordable housing, reducing carbon emissions and bringing top female talent back to the workplace.”

How Sustainable Finance Impacts Consumer Decisions

How Sustainable Finance Impacts Consumer Decisions

Sustainable finance focuses on financial investment in the long-term. Its essence has to do with funding businesses contributing to sustainable development as a way to use the economy to drive positive change. This involves lending support across healthcare, education, and even to small businesses. There’s no better time when this is needed than now.

Today, the pandemic has had a scarring impact on households and small businesses. Many people have lost their jobs, and a lot of small businesses are shut down for good. There is no better time for financial institutions to work to provide relief for less fortunate households and businesses. Not doing anything to make a positive impact on society at this time is not only unethical, but it could adversely affect the business in the long run.

This is evident from an EY research, which revealed that many consumers (more than half) value responsible banking and that their “purchasing patterns and financial institution loyalty will be impacted by financial institutions actively supporting the community.”

This research makes it evident that financial institutions investing and providing support to the community is not only ethical but will benefit such companies, business-wise.

Many consumers (more than half) value responsible banking and that their “purchasing patterns and financial institution loyalty will be impacted by financial institutions actively supporting the community.”

No longer business as usual

In the face of adversity caused by the pandemic, and the accelerating digital revolution that has already taken the world by storm, financial institutions must be at the forefront, taking measures to enhance the nature of their business. In a post-pandemic world, consumers will prefer to stick with the newer models of business since they’re less stressful and offer more comfort. In addition, they will provide strong support to companies that contribute to the betterment of the society and future generations.

Overall, this is a huge advantage for financial institutions as they can cut down on expenses and overhead cost of maintaining physical branch networks. The savings to be had as a result of these efforts can then be channeled towards driving sustainability initiatives that benefits everyone. There’s no better time to take advantage of technology and invest more in digital solutions in banking than now. It’s no longer business as usual everywhere, and financial institutions must leverage on these changes for the benefit of all.

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>> 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 Changing Banking Landscape in a Post-Pandemic World

The Changing Banking Landscape in a Post-Pandemic World

It has been several months into the Coronavirus outbreak, and the world is still reeling from its impact. Different institutions and sectors are feeling the impact in multiple ways, and the financial markets are not left out. Financial institutions have had to adopt new approaches to customer service, and it looks like these changes would not be going anywhere even after the pandemic is finally over.

The rapid rate of technological growth had been changing the face of business before the pandemic, with consumers beginning to get a grip on mobile banking and digital wallets. However, the health crisis escalated the adoption of these means of financial engagement by many consumers. With most people afraid of stepping out of their homes and banks and other financial institutions shutting off their lobbies to avoid physical engagement, consumers were forced to try the new way of doing things.

Now, as the lockdown enforcements start to ease across the world and brick-and-mortar businesses slowly reopen, financial institutions are about to experience a massive drop in the number of consumers visiting their offices. People have seen the advantage in being able to remotely manage their accounts and carry out transactions without having to visit a banking hall, why should they come and join the queues again? Banking and finances have changed, and maybe that isn’t necessarily a bad thing.

People have seen the advantage in being able to remotely manage their accounts and carry out transactions without having to visit a banking hall, why should they come and join the queues again?

Banking Has Changed

As a result of the lockdown and other measures to curtail the spread of the coronavirus, banks and other financial institutions have been forced to review and initiate several measures. Some of these measures are novel ideas, unique to the institution, while others are being adopted by all.

For example, more effort and funds are being invested in strengthening the banking call center, and in making use of mobile and internet banking. Also, banks are having to adjust the process of registering and opening an account to offer the consumer a unique remote experience that’s not so different from what they get physically. Now, consumers can open and manage digital accounts without having to set foot in the bank.

The result? Since the start of the pandemic, the number of consumers adopting these digital measures have shot up. Now, people know that life can be made much more comfortable if they get more personalized experiences, and the financial institutions offering these experiences to them are much more accessible.

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>> 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.