What The FinTech #153 - 1 Oct 2023

???Welcome to What The Fintech?- your weekly dose of electrifying insights, game-changing breakthroughs, and dazzling trends from the pulse-pounding world of fintech across Hong Kong, Singapore, China, and Asia! As your go-to source for top headlines and industry insights, we're here to keep you updated on the latest innovations revolutionizing the way we think about finance and technology in this dynamic region.

Prepare to embark on a thrilling adventure through the digital landscape as we explore the ground-breaking developments, visionary startups, and trailblazing trends that are shaping the future of finance in Asia and beyond. So buckle up, grab your favorite beverage, and get ready to ignite your curiosity with the latest and greatest from the fintech universe! Let's dive in! ??????

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WHAT THE FINTECH PODCAST & YOUTUBE CHANNEL

Hope you all had a fantastic summer. While our latest podcast episode and video are in the works and set to resume later this month, why not revisit some of our past gems?

????? Dive into previous sessions for a mix of insights and exciting discussions. ???? Stay tuned for what's coming, and as always, your likes, give a 5?, shares, and subscribes mean the world! Keep the fintech vibes strong! ????

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Call for content is now open - Have a story to share? Speak at Money20/20 Asia

Our #Money2020 #Asia Call for Content closes on Monday, 2 October, so what are you waiting for? If you have the wildest, most controversial ideas about our 2024 show themes, we want you. Find out more at https://bit.ly/3tb4xXJ

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What was the FinTech this week in:???

HONG KONG

JPEX Scandal pushes Hong Kong’s SFC to roll out new crypto rules

Hong Kong’s Securities and Futures Commission (SFC) has announced a series of new measures this week. These initiatives come on the heels of the JPEX crypto exchange debacle, which exposed vulnerabilities in the city’s regulatory framework for virtual assets. The SFC’s new measures aim to enhance transparency, improve public awareness, and tighten regulations around crypto trading platforms.? To combat the disinformation, the SFC plans to publish a comprehensive list of licensed Virtual Asset Trading Platforms (VATPs) on its website. To this end, the SFC is ramping up its intelligence-gathering efforts on businesses related to virtual assets. The SFC stated that it would continue to review the regulatory landscape in Hong Kong and take timely measures in response to new market developments. “Adhering to the ‘same business, same risks, same rules’ principle, the SFC will work with the HKSAR Government to regularly review the regulatory regime in Hong Kong and consider timely measures in light of new market developments. Under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, which came into full effect on 1 June 2023, the SFC has closed gaps in its licensing and supervision powers over VATPs. The regulator has imposed stringent requirements to ensure investor protection, including enhanced due diligence and robust governance measures.

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WeChat Pay HK offers special discounts for Hong Kong Shoppers

WeChat Pay HK has recently announced two promotions in anticipation of the upcoming Mid-Autumn Festival and National Day holidays. From now until October 15th, WeChat Pay HK users can enjoy exclusive discounts and coupons at over 30 Shenzhen shopping malls. The offers include discounted prices on selected drinks at tea shops and a discount of 50 yuan for every 100 yuan spent at the “Coco Hotpot & Tea Break” restaurant. In addition to the mall promotions, WeChat Pay HK is also distributing electronic cash coupons worth 10 Hong Kong dollars for use in mainland China. These coupons can be obtained scanning QR codes on posters in East Rail Line train carriages or participating shopping malls. The coupons have various denominations, such as 2 yuan off for every 20 yuan spent, 3 yuan off for every 30 yuan spent, and 5 yuan off for every 50 yuan spent.

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HSBC unveils digital trade finance solution in Hong Kong, Singapore, UAE

HSBC has joined forces with Cainiao Network Technology, Alibaba Group’s smart logistics platform, to offer an innovative digital trade finance solution for online merchants. The new scheme will use real-time logistics information for credit assessment, making loans more accessible and matching the needs of new economy enterprises. The innovative solution is available to Hong Kong merchants selling on the TMall Global e-marketplace. With the borrower’s authorisation, HSBC will access Cainiao Network Supply Chain Finance’s integrated information about the merchant, including business background, primary brands, Cainiao Network ratings, real-time inventory information, and operation status, to conduct a credit assessment.

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SINGAPORE

Singapore’s Grab pulls the plug on investment services citing non-viability

Grab, a Singapore-based super-app for services such as mobility, deliveries and digital financial services, is winding down its retail investment products, which have been deemed to be “not commercially viable”. On 25 September, customers of Grab’s AutoInvest and Earn+ services received an email stating the company will be discontinuing the two products in Singapore, with no new deposits being accepted. Customers have been advised to withdraw all of their money by 13 October, after which the accounts will be permanently closed, with no further transactions being permitted. The decision to wind down GrabInvest is part of its efforts to “streamline” its financial services business, focusing on other products such as GrabPay, insurance and lending.

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CHINA

Alibaba, Tencent break more digital barriers between WeChat and Taobao-Tmall as economic uncertainty in China mounts

China’s two biggest internet companies have tightened their collaboration, allowing users who click on advertisements on Tencent Holdings’ WeChat to be directed to Alibaba Group Holding’s Taobao and Tmall e-commerce platforms. The two tech giants announced on Monday that “high-quality” advertisements placed on WeChat Channels, a short-video sharing platform, through Alimama Uni Desk, an Alibaba-affiliated digital marketing platform, can be connected to shops and live-streaming rooms on Taobao and Tmall. Tencent Video, a streaming platform, has allowed direct links to Taobao since 2021. After years of fierce rivalry, Alibaba and Tencent started breaking down the virtual walls separating their services in 2021 after the Chinese government doubled on its efforts to break up tech monopolies. You can skip the ad in 5 sec with a mouse or keyboard While Tencent once limited the sharing of links to Alibaba stores on WeChat, it now lets users open a variety of links and content within its messaging function. However, some digital barriers continue to exist: for example, users still cannot use WeChat Pay for transactions on Taobao, nor use Alipay – the electronic payments service of Alibaba financial technology affiliate Ant Group – to pay for goods and services on WeChat mini-programs. Amid uncertainty in the macroeconomic environment and rising competition from younger rivals such as ByteDance’s domestic short-video sensation Douyin, Alibaba and Tencent have deepened their partnerships.

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China enables e-CNY top-up using Mastercard and VISA cards

The Digital Yuan app in China has been updated to make it easier for tourists to use digital currency during their visits. International tourists can now top up their Digital Yuan wallets using Mastercard or VISA cards before arriving in China. The app, known as e-CNY, is currently in beta and is available to iPhone users in select regions of China and China-based Google Play Store users. It allows users to create personal digital wallets for China’s state-backed digital currency, the e-CNY. The latest update to the iOS version of the e-CNY app, introduces a fresh feature. Version 1.1.1 now enables users to top up their e-CNY wallets using international card options, including Visa and Mastercard. China’s sovereign digital currency has been recently embedded into WeChat, China’s leading social networking and payment app, in a fresh move to lure new users.

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China hosts esports’ biggest moment with Tencent at the wheel

China scythed nearly $600 billion off Tencent Holdings’ market value in its crackdown on tech and gaming. Now the country is betting on its biggest company — and professionalized video games — to help restore some national pride. This week, hundreds of elite gamers are descending upon the scenic city of Hangzhou, near Shanghai, to represent their countries at the 19th Asian Games. Tencent co-developed an esports hotel in Hangzhou in anticipation of the event, where fans can be close to the action while also playing their favorite games. Esports is “incredibly, massively favored by the Beijing government.” Tencent already treats pro gaming as the fulcrum of its long-term strategy. When it launched the globally popular shooter Valorant in China in July, it immediately organized a series of esports matchups for the Riot Games Inc. The company also licenses its brands and gaming franchises at real-world locations like the esports hotel.? Laying the groundwork for the tournament, the government in Hangzhou built a stadium dedicated to esports. Tencent also tweaked its games for the event, adding Hangzhou tourist sites and Asian Games mascots to its virtual battleground in Honor of Kings. The last time pro gaming took over a Chinese city was in the midst of the pandemic in 2020, as the League of Legends championship attracted thousands to a soccer stadium in Shanghai and 45 million viewers online. Between now and then, Tencent will seek to reassert its leadership as the premier games publisher and event organizer, which should help both its bottom line and its relationship with an expectant Beijing.

ASIA

Stripe deepens product investment in Southeast Asia

Stripe ntroduced new product updates to support businesses of all sizes in the region, enabling them to cater to the surging demand for digital commerce and pursue global growth opportunities. Beyond payments, Stripe also showcased solutions for businesses to modernize their finance stack to increase efficiency and productivity through automation. A recent Stripe report on global digital trade showed that 84% of Singapore consumers were open to purchasing physical products online from a company based in another country, and 74% were open to purchasing digital services— significantly above the global average of 68%. Businesses that switched to Stripe’s newest payments integration—the Stripe Payment Element—saw a 10.5% increase in revenue on average compared to those that did not. This included the Stripe Reader S700, its newest customisable point-of-sale device that allows businesses to accept payments, collect relevant customer details like signatures and email addresses, and make it easy for businesses to customize the device, including branding their splash screen and running custom apps for taking orders. The Stripe Reader S700 is the latest demonstration of Stripe’s commitment to in-person payments, following the launch of Stripe Reader M2 in 2021, Stripe’s launch of Tap to Pay on iPhone in 2022 and Tap to Pay on Android in 2023. Link speeds up checkout for customers by saving payment details that can be used at hundreds of thousands of businesses on Stripe and, in turn, increases conversion for businesses.

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Thunes expands its Acceptance Network in five Southeast Asian countries

Global payments platform Thunes has announced the expansion of its Acceptance payment network to Indonesia, Malaysia, Philippines, Singapore, and Thailand. The expansion of the Acceptance Network is set to enable global businesses to accept payments from multiple popular local payment brands from Indonesia (DANA, OVO, QRIS, ShopeePay, or Alfamart), Thailand (Bank of Ayudhya – Krungsri, KBank, Krungthai Bank, SCB, Bangkok Bank, Rabbit LINE Pay, or PromptPay), Philippines (GCash, INstaPay, GrabPay, Maya, PESONet, Cebuana Lhuillier, or ShopeePay), Singapore (Atome, PayLater by Gran, or GrabPay), and Malaysia (GrabPay, Maybank QR, ShopeePay, DuitNow, Boost, or Touch ’n Go).? Through the usage of the acceptance network, companies and businesses can tap into a vast digital-first customer market in order to develop connections with multiple potential clients via its payment methods available in 90 countries around the world. This will meet the needs of companies that seek to take advantage of the growing purchasing development present in the Southeast Asia region while addressing the challenges they might face at the same time.

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81% Of Asian consumers think there are ‘too many’ subscription services to choose from Now

93% want a single hub to manage all subscriptions including video, music, gaming, sport, and more The boom in the subscriptions economy is threatening to overwhelm consumers across India and Southeast Asia. Well over three quarters (81%) of subscription users believe there are now “too many” subscription services available. As a result, 93% now demand a unified platform to administer all of their subscriptions. Yet, despite many feeling the subscription fatigue, 81% say they would sign up for more subscriptions if they were consolidated through a centralized content hub. 86% of consumers have 2+ subscriptions and 15% have more than 6. These include services ranging from streaming to food delivery, music to sport, and everything in between. With so many subscriptions to manage, each on separate platforms, it’s no surprise that consumers are frustrated by the administrative nightmare. Many are losing track of their current subscriptions, leading to unnecessary costs. Nearly half (44%) say that they’ve kept paying for subscriptions they forgot were still active, while a third (32%) say they currently pay for a subscription service that they ‘never use’.

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Fujitsu trials gen-AI for Japanese banks- used to respond to internal inquiries, generate and verify business documents and create programs

Japanese technology giant Fujitsu is to conduct trials into the use of generative AI (gen-AI) for banking operations. The tech vendor has partnered with Japan-based Hokuhoku Financial Group for the experiments. Fujitsu’s AI platform, Fujitsu Kozuchi, will be applied to the banking operations of Hokuriko Bank and Hokkaido Bank, two Hokuhoku subsidiaries. More specifically, the gen-AI module on the platform will be used to respond to internal inquiries, generate and verify business documents and create programs.? The objective is to identify promising use cases for the technology.

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DBS should focus on digitalisation to capitalise on its acquisition of Citibank’s Taiwan operations

In August 2023, Singapore’s leading bank DBS completed its acquisition of Citibank’s consumer business in Taiwan (Province of China). As a result, DBS becomes the largest foreign bank in the country. In contrast, Citibank accounted for 10.3% of the credit card market, highlight the attractiveness of the deal for DBS. In addition to credit cards, DBS has increased its share across products including personal loans and residential mortgages, making it competitive in the market. While the move immediately boosted UOB’s position in these markets, the bank is not resting on its laurels. To fully capitalise on the acquisition and boost profits, UOB plans to digitalise the Citi customer base, improving the bank’s apps while reducing costs via bank branch optimisation. GlobalData’s 2023 Financial Services Consumer Survey found that the top driver for provider choice in the country is an easy-to-use digital banking platform. DBS’s Platform Operating Model and cloud capabilities have enabled the bank to create hyper-personalised digital experiences, artificial intelligence-powered services, and peer-to-peer payment systems. Enriched services such as these will be highly attractive to DBS’s new customer base, meaning the bank should strongly promote its digital capabilities.

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Amazon Pay expands festive offers in India, plans to increase credit card partnerships

Amazon Pay, Amazon’s online payments processing service, announced exclusive festive season offers for debit and credit cardholders of State Bank of India (SBI). The partnership aims to serve over 30 crore Indian customers, including Rupay cardholders. Offerings such as Amazon Pay UPI, Amazon Pay Wallet, their flagship Amazon Pay Later, and the Amazon Pay ICICI co-branded credit card. within the Amazon ecosystem, it is faster and more convenient to pay using an Amazon Payment Product. Consumers in Maharashtra have reported a 96% success rate with APP payments. In addition to its SBI partnership, Amazon is planning to expand its credit card offerings by collaborating with more banks.

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WhatsApp adds rival in-app payment options in India commerce push

WhatsApp will offer credit card payments and services from rival digital payment providers within its app in India, the latest bet by the Meta-owned service to boost commerce offerings in its biggest market. WhatsApp has more than 500 million users in India, though regulators there have capped its in-app WhatsApp Pay service to only 100 million people. People shopping on WhatsApp could also pay using popular services like Alphabet Inc’s Google Pay, Paytm and Walmart’s PhonePe but only after being redirected outside WhatsApp. Payments via those rival services -— and any others that run on India’s instant money transfer system UPI — will now be possible directly within WhatsApp. New in-app options for credit and debit cards will also be offered.

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India’s joining JPMorgan’s Emerging Market Global Bond Index will favourably impact the country’s external balance sheet, deepen its bond markets, and lower the cost of capital

India’s joining JPMorgan’s Emerging Market Global Bond Index will favourably impact the country’s external balance sheet, deepen its bond markets, and lower the cost of capital. The inclusion begins in June 2024 with a weight of 1%, increasing 1% each month until it reaches 10% by April 2025. It is expected to lead to $30 billion in inflows into its government bond market, with monthly inflows of $3 billion during the inclusion period. Only 30% of GBI-EM investors have actual India exposure in their portfolios, despite the 73% of investors that supported the index inclusion. Post-inclusion, India is set to become the second-largest emerging-market country in the index after China, bringing Asia’s contribution to the index to approximately 50%. Other countries’ weights are to be reduced, with Thailand at 1.65%, South Africa at 1.36%, Poland at 1.27%, Brazil at 1%, the Czech Republic at 1%, Colombia at 0.78%, and Romania at 0.65%.

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Indian actor wins court order against unauthorized deepfake imitations of his likeness

Indian actor Anil Kapoor has secured a win in court against the unauthorized creation and use of AI imitations of his likeness and other deepfake synthetic media based on his image and personality. A New Delhi court issued an interim order against 16 defendants barring them from exploiting the Bollywood star’s name, likeness, or other aspects of his identity for commercial gain without permission. This includes use in merchandise, ringtones, videos, and other content. Kapoor sought legal recourse in response to the proliferation of distorted videos, GIFs, and emojis bearing his appearance. The unauthorized use of a catchphrase of his also prompted the legal action, which is aimed at establishing protections that outlive Kapoor’s career, according to the legal filing. The decision by the Indian court won’t set anything in stone in India or globally, but it does help in establishing an early precedent on behalf of those who wish to protect the economic value of their face and persona.

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And that's it for this week's What The Fintech ?? We hope you've found our selection of Asia's fintech trends, innovations, and insights both informative and valuable. Your feedback and suggestions are important to us, so please share your thoughts to help us curate content that matters most to you. ??

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Until next week, keep exploring the future of finance together! ?

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Your Fintech Navigator,

Medhy

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