The banking landscape in Asia is now changing rapidly, driven by emerging and real time digital payment methods, particularly in China. Many new fintech solutions are coming to the fore facilitated by developments in retail and online. In the process the region is emerging as an innovation hub for payments.
“We expect so much more in our personal lives, we expect instant gratification,” explains Jennifer Doherty, Head of Innovation for Global Liquidity and Cash Management in Asia at HSBC.
Many developments are focused on making payments faster, cheaper, more transparent and reliable. The technologies employed include blockchain, biometrics, APIs and real time payment networks.
“We’ll also see a lot around smart contracts and that’s going to be a really exciting space to watch,” states Ms Doherty.
Electronic payment using mobile apps is a primary example of how financial technology or fintech is changing everyday life. In China alone the mobile market is worth USD17 trillion.1 The number of non-cash transactions in Asia is expected to reach 277 billion by 2020, according to the World Payments Report 2017.2
Now a large network of global banks are trialling cross-border payments using blockchain or distributed ledger technology.
“Faster payments are being put in every single country, if you look at India, Australia or Singapore that means money can be delivered from person to person very quickly,” explains Navin Gupta, Managing Director, South Asia & MENA for Ripple.
“What it is creating is velocity within a specific country and now this is happening cross-border as well. The outcome is that you essentially increase the velocity of money in a country and get higher GDP growth rates.”
Asian financial institutions are also now collaborating with fintechs to fundamentally change the way international remittances work. The goal is to make them easy, seamless and error free.
“HSBC is working with technology firms to co-create with them and bring things to market that are meaningful to customers, which at the end of the day is what we’re here to do,” says Ms Doherty.
1 Ant Financial's USD150 billion valuation, and the big recent bump-up, Reuters
2 World Payments Report 2017, Cap Gemini
Disclosure and disclaimerMore, collapsed
For professional clients and eligible counterparties only.
All information is subject to local regulations.