What The FinTech #143 - 3rd Year - 4 Jun 2023
🥳🚀 Buckle up, FinTech enthusiasts!
We're blasting off on a special journey marking 3 power-packed years and a whopping 143 editions of your favorite What The FinTech newsletter.
From cutting-edge trends to mind-bending tech, we've traversed the dynamic FinTech terrain together. Your unwavering support has fueled this thrilling adventure, and for that, we thank you!
A special shout-out to our super Nick Kwan. His weekly summaries, engaging infographics, and captivating videos have added that extra spark to our journey. Thanks for your tireless dedication, Nick!
So here's to you, our valued reader, as we kick-off our anniversary celebrations with another week of hot-off-the-press FinTech insights.
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What The FinTech Episode 59 - Bitkub
Join us on a captivating journey with our distinguished guest, Topp Jirayut Srupsrisopa™, the visionary Founder and Group CEO of Bitkub. We'll navigate through the labyrinth of Thai crypto regulations, dive into the depths of addressing the issue of the unbanked population, and illuminate how Bitkub is rewriting the rules for financial inclusion, all at an impressively low cost.
You'll discover how Bitkub, weathering the crypto winter storm, became the first to secure a crypto exchange license in Thailand and remained profitable. We'll also unmask their ingenious customer acquisition strategies, discuss their local monopoly model, and unveil the company's ambitious expansion plans as Southeast Asia steps into its golden fintech era.
🎧 Tune in for a treasure trove of fintech insights!
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Stay tuned for more engaging conversations right here on "What The Fintech!" 🔥
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What was the FinTech this week in: 📰
HONG KONG
ZA Bank Set to Launch Virtual Asset Trading Services in Hong Kong
ZA Bank planned to launch new services in response to the growing demand for virtual assets in Hong Kong. By partnering with Hong Kong-licensed virtual asset exchanges, ZA Bank aims to obtain the required regulatory approvals to enable retail investors to trade virtual assets by using fiat currency within its ZA Bank App. The move comes as part of ZA Bank’s strategic expansion plan to provide a comprehensive suite of financial services. In addition to virtual asset trading, ZA Bank also plans to introduce US stock trading services in the near future.
foodpanda partners with DBS to Launch „Less Food Waste Reward‟ as well as Donation Matching Campaign to Foodlink Foundation
foodpanda Hong Kong and DBS Bank (Hong Kong) Limited have partnered to launch a "Less Food Waste Reward‘ as well as a six month 'Donation Matching Campaign‘. To reduce food waste, customers can select the 'Less Rice‘ or 'Less Noodles‘ option from 640 participating restaurant outlets on the foodpanda platform when ordering food delivery or using the Pick-Up service. During the campaign period, upon checking out with a DBS Credit Card, users may also receive a foodpanda HK$20 Pick-Up voucher*! Additionally, as part of foodpanda‘s existing 'Donate a Meal‘ initiative, all donations made by DBS Credit Cardholders to Foodlink Foundation will be matched by both foodpanda and DBS respectively, meaning a tripled donation amount!
PAOB debuts Hong Kong SME virtual loans
Small and medium-sized (SME)-dedicated virtual bank Ping AnOneConnect Bank (Hong Kong), or PAOB, has partnered with eftPay (Asia), a Hong Kong electronic payment service provider, to launch a new loan service - Business Revolving Loan. The service allows eftPay‘s SME customers in the territory to navigate through opportunities amid the post-pandemic economic recovery in a timely, convenient manner via virtual banking. The maximum credit amount of loan service is HK$300,000 (US$38,300), with a repayment period ranging from one to three months. SMEs can have numerous withdrawals within the approved credit limit in a year, allowing them to allocate their funds anytime and anywhere.
HSBC creates US$3 billion fund to support tech firms in Hong Kong, China with an eye on enhanced role of the knowledge economy in Greater Bay Area
HSBC, Hong Kong‘s biggest bank, will upsize its lending scheme tailor-made for start-ups to US$3 billion as it widens its support to new economy companies in Hong Kong and mainland China following strong inflows from clients of Silicon Valley Bank (SVB).HSBC will create the HSBC New Economy Fund, by combining two lending schemes set up in 2019 to provide financing to the healthcare and technology sectors in the Greater Bay Area, and would increase the size of the aggregate lending capacity from US$1.8 billion. The UK unit offered a strategic fit by enhancing HSBC‘s ability to serve innovative and fast-growing companies in the technology and life-science sectors. The new fund will have innovative product features such as embedded equity warrants, which addresses needs of early stage start-ups. It will also widen its coverage to support start-ups in climate tech, industrials, and consumer sectors in Hong Kong and mainland China, in addition to its original mandate of serving sectors like technology, healthcare and life sciences.
SINGAPORE
MAS partners Google Cloud to advance generative AI capabilities
The Monetary Authority of Singapore (MAS) is partnering Google Cloud to advance its capabilities in generative artificial intelligence (AI) technology that is grounded on responsible practices. Through the initiative, the central bank hopes to encourage wider use of responsible generative AI by Singapore‘s financial industry. Generative AI is a branch of AI technology that has the capacity to produce new content, including text, synthetic data and images. The MOU will provide a framework for the MAS and Google Cloud to identify potential use cases, conduct technical pilots, and co-create solutions in responsible generative AI for MAS‘ internal and industry-facing digital services. MAS and Google Cloud will also work together to develop responsible generative AI technology applications, and test-bed cutting-edge AI products for business functions and operations.
StandChart and Singapore FinTech Association publish blockchain paper
Standard Chartered, together with the Singapore FinTech Association (SFA) as its knowledge partner, have published the Deepening Sustainability with DLT‘ paper that explores how different stakeholders can work together to improve payment transparency in supply chains. The paper advances knowledge on complex topics such as Distributed Ledger Technology (DLT) and how it can be used in supply chain payments for corporates, financial institutions and their corresponding ecosystems. With support from the SFA, the paper highlights case studies where digital currencies have enabled desired sustainability outcomes, while highlighting the key roles that banks, fintechs, corporates and non-governmental organisations can play in creating an ecosystem that is sustainable and future-proof. Importantly, the paper outlines a framework where various blockchain solutions were measured against a set of qualifying criteria to identify the most efficient set of sustainability outcomes.
CHINA
Baidu commits $140M fund to back ChatGPT-like startups
Baidu, Inc earmarked 1 billion yuan ($140 million) to finance Chinese startups that explore generative AI, marking the rush to tap the ChatGPT frenzy. The company proposes to utilize the pool to incubate projects built atop its Ernie AI model in deployments of up to 10 million yuan apiece. Baidu and its VC partners will examine pitches from prospective founders who will use Ernie to build out their services. The ChatGPT frenzy also comes with its share of challenges. China's top internet regulator has said it will require security reviews of generative AI tools before implementation.
China's UnionPay surpasses Visa with largest market share of debit card transactions
China's UnionPay surpassed Visa for the first time in 2022, securing 40.03 percent of global debit card transactions. Visa's share of debit card transactions was down 82 bps to 38.78 percent in 2022, ranking second to UnionPay. Throughout the global networks, debit cards accounted for 63.88 percent of total purchase transactions in 2022. For Visa, debit card purchase transactions were 63.91 percent of the network's worldwide total, down 198 bps. UnionPay purchase transactions were 75.12 percent debit, an increase of 182 bps. From 2011 to 2021, the market share of Visa's debit card transaction has dropped from nearly 80 percent to 39.53 percent; while UnionPay's share within the payment system jumped from nearly zero to 38.68 percent.
China’s Nanjing launches metaverse platform to advance research and development
Nanjing, the capital of China‘s Jiangsu province, has announced the launch of the China Metaverse Technology and Application Innovation platform designed to push the frontiers of virtual worlds and blockchain. The metaverse platform will be operated by the Nanjing University of Information Science and Technology (NUIST) with research at its core. As such, the steering committee of the platform consists of academics from universities across China, while metaverse-related firms contribute a healthy quota. The new platform aligns with China‘s objectives to leverage innovative technologies to improve the digitization of its economy. Nanjing is no stranger to metaverse innovation, prompting city officials to express confidence in embracing the ―technological wave.
China’s Wechat rolls out “palm payment"
Tencent‘s WeChat Pay rolling out their new ―palm payment method, where you can make actual payments at establishments just by waving your hand! That essentially means that users can leave the house without their wallets, and even their phone, and still be able to make payment transactions. The technology works by recognizing individual users‘ unique surface-level palm prints and distinct hand vein patterns. In order to use ―palm payment, users will first have to register their palm print on a designated device, then link their payment details and that‘s it—they can now make automated payments with just a wave of their hand!
Beijing’s Internet 3.0 white paper focuses on metaverse, a little web3, not crypto
The White Paper sees Web3, as the inevitable trend for the future of the internet industry. It encompasses immersive interactive experiences and a fusion of virtual and physical realities. This scope includes a blend of sensory experiences and economic activities in the physical and virtual world, covering the Metaverse and Web3. According to Star Mine data from Cailian Press, 46 listed companies, including Wanxing Technology and Tianyu Digital Science, are already positioning themselves in the Web3 space. The White Paper identifies generative artificial intelligence, XR interaction terminals, and content creation tool platforms as the research hotspots of the Web3 industry. New applications such as digital personas and digital collections are rapidly developing, with innovative entities exploring practical applications. Yu Jiajing, Executive Director of the China Mobile Communications Federation Metaverse Industry Committee, believes that Web3 is the most critical new species of the next digital economic era. The digital economy, a more advanced stage of economic development and a future global direction, will become critical mechanism for stabilizing economic growth and achieving economic recovery in the context of global economic downturn pressure. Web3, according to Yu, is a new value internet system that not only inherits the previous internet ecosystem but also further upgrades it with the autonomy of personal data ownership. It will create application fields that were not present in Web1.0 and Web2.0. For instance, prototypes appearing in the Metaverse will rapidly develop in Web3.
ASIA
Wise platform secures first Japanese client, GMO Azora Net Bank
Wise Platform, Wise‘s infrastructure offering for banks and non-banks alike, has announced its first partnership in Japan with GMO Aozora Net Bank, Ltd, bringing fast, low-cost international payments to more than 80,000 corporate customers. Powered by Wise Platform‘s easy-to-use APIs, GMO Aozora Net Bank customers can now send international payments in 8 currencies to 28 countries and regions including the US, UK, China, Australia, and Singapore. GMO Aozora Net Bank‘s corporate customers can access this new service via their internet banking platform 24 hours a day, 365 days a year. Thanks to Wise‘s cross-border payments network, they can even expect their payments to be completed in as little as 2 minutes. This means businesses can better manage their invoicing and supplier payment needs.
Softbank launches in-house AI chat service
SoftBank Corp., a Japan-based telecom and IT operator, has launched its own artificial intelligence (AI) Chat service for internal use. The SoftBank-version AI Chat service was launched for internal use so all SoftBank employees can utilize generative AI for their work more proactively and safely in a secure environment. SoftBank employees will be able to fully utilize this AI service in a safe environment so they can perform their existing tasks better and boost their efficiency and productivity by, for example, creating documents and making translations. In addition, SoftBank aims to extend its AI Chat service to support all internal work processes, including planning and idea generation for proposals in sales and marketing, various programming activities for service development, and call center tasks.
Grab Malaysia revives its carpool service under a new name, available in selected areas only
Grab Malaysia just announced that they‘ll be piloting a carpooling service called JustSave. Starting May 29, 2023, it will only be available in selected locations in the Klang Valley. Through the service, customers will be able to carpool with another passenger that‘s heading in the same direction or route. JustSave fares will be slightly more affordable than its regular e-hailing service. On average, it claims customers will save up to 20% when they share a ride. On the other hand, it gives driver-partners another option to improve their earnings per minute by serving multiple bookings at once. These bookings will have to be taking the same route or be headed towards similar destinations. As part of the piloting exercise, JustSave will only be rolled out in several areas within the Klang Valley. Currently, it‘s concentrated in high-traffic areas with high matching possibilities. For now, this is limited to KLCC, Mid Valley Bangsar, Sentral Brickfields, and One Utama/First Avenue.
Binance gains first Southeast Asian license from Thailand
Thailand’s Securities and Exchange Commission on Friday approved a joint venture between Binance and Gulf Energy Development to operate a digital asset exchange and brokerage, granting the cryptocurrency giant its first license in Southeast Asia. Operations will launch in the fourth quarter of 2023 as a 51-49 joint venture between Gulf Innova and Binance. The former is the fintech arm of Gulf Energy, one of Thailand’s largest private power producers, which invested USD 20 million for a 0.4% stake in Binance’s US operation. The arrival of Binance, the world’s largest cryptocurrency exchange by trading volume, will likely shake up Thailand’s digital asset market. Local exchange Bitkub had grown its share to a dominant 75.4% after No. 2 exchange Zipmex faced a liquidity crunch from the Terra Luna crash in the middle of 2022. Thai digital asset exchanges saw a 79% drop in trading volume last year during a crypto winter that ultimately felled global exchange FTX, Binance’s rival. This is the seventh exchange and brokerage license granted by the regulator.
Tourists from four Asian countries and regions can now pay in Thailand with mobile wallets
Ant Group, the operator of Alipay+, the global cross-border digital payments and marketing solution announced that a total of four mobile wallets are now accepted in Thailand. These include AlipayHK (Hong Kong SAR), Kakao Pay (South Korea), Touch'n Go eWallet (Malaysia) and Alipay (Chinese mainland). Enabled through Alipay+, the latest development and the addition of three more mobile wallets will expand the seamless digital travel experience for more Asian tourists visiting Thailand, in the midst of a rapid rebound in the local tourism industry. Ant Group also unveiled new collaborations with the Tourism Authority of Thailand (―TAT), to promote the Amazing Thailand campaign and to stimulate travel in Thailand. In addition to facilitating purchases and transactions made by mobile wallets familiar to tourists, Ant Group will also provide digital solutions to local businesses in areas such as digitalisation of service operations, digital marketing efficiency and customer experience enhancement. This is targeted at helping local merchants to engage tourists more effectively throughout their journey from pre-trip to post-trip. Local businesses can leverage solutions including the Alipay+ D-store™ to build digital stores in the form of mini programmes, leveraging digital platform to reach and engage tourists.
Asia Pacific continues growth trajectory in Real-Time payments market, leads the way in cross-border payment linkages
Real-time payments (RTP) transaction volumes in the Asia Pacific (APAC) region are expected to grow from 49.2 billion in 2022 to 96.2 billion by 2027, representing a CAGR of 14.1%. APAC is one of the most innovative RTP markets globally, with advanced, user-friendly services such as QR code payments and mobile-native experiences propelling RTP adoption. Support from governments or central banks and their investment in modern infrastructure is key to RTP adoption in the region. Indonesia is the most recent major country in the region to adopt RTP and is set for rapid RTP growth at a CAGR of 81.9% between 2022 and 2027. This makes Indonesia's BI-FAST one of the world's fastest-growing and most successful RTP schemes. RTP volume in Malaysia is projected to increase at a CAGR of 19.7% from 2022 to 2027. Rising consumer awareness, growing preference for mobile payments, increasing development of B2B use cases, such as Request to Pay, and the growing cross-border QR-code payment linkages forming between Malaysia and Indonesia, Singapore and Thailand are the drivers behind the growth. Thailand was the fourth leading country in the world in terms of volume of RTP transactions in 2022, with 13.9 billion transactions on its RTP system, PromptPay. Thailand is also projected to be the top country in APAC in consumer adoption of RTP. By 2027, every Thai citizen is expected to make an average of 43.6 real-time transactions per month. New Zealand has yet to establish a domestic RTP system, but the nation has laid out its ambition to follow the emerging trend of payments modernization. In November 2022, Payments NZ released an RTP discussion document designed to broaden the conversation regarding RTP infrastructure.
Mesh Payments introduces global spend management in local currencies
Mesh Payments announced expansion of its unified spend management platform to support global multinational businesses operating in Europe, UK, and Asia in local currencies. Mesh now enables companies to operate globally across international entities, issue local cards and settle in local currencies all from one unified platform. The new product capabilities to help companies save money and increase finance team productivity, and competitive customer wins across technology and financial services sectors, including Fortune 100 companies.
Amazon experiments with Dine-In payments in India
Amazon is experimenting with dine-in payments in India via Amazon Pay. Users dining at some restaurants in select areas of Bengaluru can make payments under the ―dining section of Amazon Pay on the Amazon app. Food delivery giants Zomato and Swiggy each offer in-restaurant payments, while Zomato recently rolled out its own UPI service in partnership with the ICICI bank for faster checkout and bill payment. It also points out that India‘s National Restaurant Association issued an advisory to members last year warning against dining payment offerings from food delivery firms.
India to expand CBDC pilot with under $1 million currently in circulation
The Reserve Bank of India (RBI) gave an update on its digital rupee work, saying the results for the central bank digital currency (CBDC) pilots were satisfactory. So far, there is less than $1 million in circulation for the retail CBDC. It plans to expand the locations, the number of banks involved, and the use cases. The wholesale pilot still involves the same nine banks and use case, with the wholesale CBDC in circulation standing at a relatively modest INR 100.39 million ($1.2 million). The figure for retail CBDC is even smaller at INR 50.7 million ($600,000) at the end of March. According to a previous update in February, 50,000 consumers were involved in the pilot. The consumer-focused eRupee pilot is ramping up considerably. It started with four banks, which expanded to eight, and another five banks are in the process of joining. Regarding geography, the first locations were Mumbai, New Delhi, Bengaluru and Bhubaneswar, with another ten regions currently being added.
KPMG in India and OutSystems announce an alliance to offer innovative low-code digital solutions to customers
KPMG in India and OutSystems, one of the global leaders in high performance modern application development, are partnering together to deliver innovative low-code digital solutions to customers, for implementation across the customer‘s entire user base. Together KPMG in India and OutSystems will look to provide clients and customers, with the ability to develop and deploy new, innovative low-code digital solutions at a faster pace with fewer resources than ever before. The joint proposition will see KPMG in India and OutSystems working together and offer clients and customers the following: Development and deployment of complex cloud or on-premises enterprise applications combined with KPMG in India‘s experience on delivering low-code solutions by leveraging technology expertise could help customers realise true business value in financial services and other sectors. Ability to integrate with existing IT infrastructure, resulting in eliminating the need for a ground-up development of enterprise applications. Quick turn-key development of last mile applications and interfaces could help extend the capabilities of systems deployed across the enterprise. Help move the organisation away from high-code ecosystem, that will consequently lead to incremental modernisation of the application environment of the enterprise.
Razorpay launches one-step payments solution Turbo UPI
India-based fintech Razorpay has launched Turbo UPI to allow customers of online merchants to make UPI payments with redirection to a third-party UPI app during checkout. Razorpay Turbo UPI aims to deliver a 5X faster payment experience. It streamlines the payment process and eliminates any redirection to external apps. This helps businesses achieve a significant increase in the success rate of UPI payments by 10%.Turbo UPI also offers granular insights into the end-user‘s drop-off pattern and enables merchants to control the entire payment experience of their customers. For customers, this means a simple 1-step UPI payment experience instead of 5 steps. Customers of popular apps including Tata Starquik, Ixigo, FNP (Ferns N Petals), Trainman, and Dhan among others will soon be able to get the benefits of this innovation.
ICICI Bank to ask for ID for non-clients 2,000 IRN exchange
India-based ICICI Bank has announced its decision to require non-bank customers for ID proof in order for them to exchange IRN 2,000 banknotes. Following the Reserve Bank of India‘s announcement regarding the need to withdraw the INR 2,000 note from circulation, banks and financial institutions across the region started to accept INR 2,000 notes for exchange from their clients and customers. Individuals that don‘t have an account with the ICICI Bank will be asked for ID proof in order for them to have the possibility to exchange the INR 2,000 notes. Furthermore, they will need to also provide the required form for note exchange as the bank will have to submit the transaction details and information with the Reserve Bank of India (RBI) immediately after the procedure is done. Customers of the bank will not need to submit any ID proofs or details regarding their identity for the exchange of notes.
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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! ✨
Your Fintech Navigator,
Medhy
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