- Specifics Of the Market Asian market is truly unique. The degree of separation and difference between each market in Asia is much wider as opposed to countries in Europe. Each country is moving at its own pace. They all have a diverse set of needs that FinTechs can capitalize on. For example, microfinancing is much more popular in Indonesia than in Singapore where digital payments and its national QR-code initiative will aggregate all QR-code payments is in the works. Most big banks in Singapore actually have operations across Asia. They have done expansions by acquiring local banks. Integration of local entities into a group is often not done perfectly. What RegTech can offer to banks in Asia is actually a way to manage their internal compliance in a central way and see where they have discrepancies with local processes with different countries in Asia, allowing them to make sure that they don't have inconsistencies.
2. Singapore Is in Transition Phase Regarding FinTech Regulations Singapore is purely one of the most challenging countries in Asia in terms of regulations: it is a very well-developed market, but also a highly regulated market. Whereas regulations specifically for FinTechs are concerned, as Nik Storonsky, CEO and Founder of Revolut shared with us recently, Singapore is presently in a transition phase. Local regulators are in the process of consolidating the country’s various rules and regulations relating to payments and stored value facilities, which may no longer be as relevant to the current market, into a new regulation - known as the Payment Services Bill. This situation gives a green light to RegTech firms offering innovative solutions for financial technology companies working in the region. - Monetary Authority of Singapore MAS is a really powerful regulator. MAS itself is doing a lot, and it is following the FCA as well. They even provide funding to FinTechs and RegTechs. It collaborates very closely with the UK's FCA, which has been an example of how to lead innovation forward, how to provide a sandbox environment to the new entrants to the market. They are looking at how they can develop that market the fastest possible.
- Speed of Technology Adoption In Asia, the speed of technology adoption is fast as there is no well-established legacy. Thus, the market is developing at a quick pace. For RegTechs, it means that there is a potential to speed up the sales cycles and actually have faster adoption of the platforms within banks in Singapore and other countries. The recipe for success is the type of services that you provide when it is very difficult for the competitors to provide the same. If that's the case, it means, success in the Asian market will be reached despite competition.
- Openness And last, but not least, the Asian market is definitely open to newcomers. If you have a presence in Singapore, people are very open to collaborating, working with companies from Europe. Because, when you open operations in Singapore, to local banks, it shows the commitment of that company to the local market. And also, in Hong Kong, there are lots of European companies. FinTech companies see Hong Kong as the doorway to China. It's a massive financial market as well. You can land in Hong Kong, and if you are able to show that you can sign clients there, it’s a good sign that you will potentially be able to operate in China as well.
5 Factors Accelerating Growth of FinTechs in Asia
In Asia, the speed of technology adoption is fast as there is no well-established legacy
April 3, 2019