six takeaways from start fintech conference 2017 · 2017. 7. 6. · the singaporean government is...
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July28,2017
DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
Six Takeaways from START Fintech Conference 2017
Source:FGRT
FungGlobalRetail&TechnologyattendedtheSTARTFintechConference2017ConferenceinHongKong.Below,weprovideourkeytakeaways.
1) Theconsensusviewofthespeakersandpanelswasthatstartupsandestablishedincumbentsarepartnersratherthancompetitorsinthefintechrevolution.Visahasbeenactiveindevelopingblockchainandartificialintelligence(AI),andhasbeenopeningitsAPIplatformforthedevelopercommunitytotapinto.
2) Singaporeisacceptingoffailureinfintechexperimentations.Grantscanbegivenout,evenifthereisahighprobabilityoffailure,becausetheyrecognizethatthereisstillknowledgetobegained.
3) Fintechisseenasanenablerforthefinancialindustryindrivinginclusivefinance.Singapore-basedremittancestartupToastseekstoservetheunderbankedpopulationandcapturetheUS$29.8billionremittancemarket.
4) Enterprisestendtobesuccessfulindrivinginnovationwhenthereareinternalchampionstolead.Agoodexampleisforacompanytohaveaninternalchampionspeakwitheachbusinessunit,identifypainpoints,maketherightintroductionsandhelpmanagetheprocessofstartupsmaneuveringthroughtheorganization.
5) HSBCandOctopushighlightedthesocialdimensionofmobilepaymentswhichhelpsdrivehowquicklyacountryadoptsmobilepayments.
6) HSBChasbeendrivingtheuseofblockchainintradeandsupply-chainfinancebycreatinganewleveloftrustandreducingthevolumeofpaperwork.
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July28,2017
DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
AboutSTARTFintechConference2017FungGlobalRetail&TechnologyattendedtheSTARTFintechConference2017ConferenceinHongKongonJuly27.
FintechSectorDevelopmentinSingaporeStanleyYong,HeadoftheInnovationAccelerationOfficeoftheMonetaryAuthorityofSingapore(MAS),sharedhisvisionforthefintechindustryinSingapore.Hebelievesthat,asfintechdevelops,therelationshipbetweenfinancialinstitutionsandfintechstartupswillbecomplementaryandfintechwillhelpfinancialinstitutionsdobetter.TheMAShasvowedtoinvestS$225million(US$165million)infintechbytheendof20201todrivefintechinnovation.Underthegrantscheme,theMASwillfunduptohalfthecostofpromisingfintech“proof-of-concept”trialsbasedinSingapore,uptoamaximumofS$200,000foreachproject2.Singaporeisacceptingoffailureinexperimentations.Grantscanbegivenoutforexperiments,evenifthereisahighprobabilityoffailure,becausetheMASrecognizesthatknowledgeisstilltobegainedfromfailures.
Singaporewilltakeanagnosticapproachbetweenexistingincumbentsandnewcomers.TheSingaporeangovernmentisfundingdevelopmentsinfintechenablers,moresothandisruptors.Thecountrywillhelpstartupsgrowrapidlyintheregion,while,atthesametime,helpincumbentfinancialleaders.
YongsharedthefollowingexamplesofhowSingaporehasbeendrivinginnovationinitsfintechindustry:
• Electronicpaymentsasanexample:TheMAShasbeenstudyinghowtobuildaninstantpaymentsystemforthepublic,similartotheUK’sFasterPayments3.OnJuly10,2017,anewpeer-to-peerfundstransferservicePayNowwaslaunched.PayNowletsuserstransferfundsusingjusttheirmobilenumber,almostinstantlyandisfreeofcharge4.
• Easieraccesstocapital:TheMAShasmadeiteasierforstartupsandsmallandmedium-sizedenterprises(SMEs)togainaccesstosecurities-basedcrowdfunding(SCF),withouthavingtoissueaprospectus5.
• Theinsurancespaceasanexample:WiththedevelopmentsintheInternetofThings(IoT),insurancecompaniescanlookatdrivinghabitstodecideonpremiums.
• Standardization:Singapore’sstrategyistodevelopApplicationProgrammingInterfaces(APIs)toachievestandardizationandencouragecollaboration6.
Whenposedthefrequently-askedquestionastotheeffectoffintechonjobs,Yongthinksthattheneteffectwouldbealossofexistingjobs.However,hebelievesthegoaloffinancialinclusionwoulddrivenewjobcreation.
1Singaporetriestobecomeafintechhub,Economist(link)2Newgrantoffersupto$200,000forpromisingfintechideasinSingapore:DPMTharman(link)3http://www.fasterpayments.org.uk/4PayNowPressRelease(link)5MASimprovescrowdfundingaccessforstart-upsandSMEs(link)6OpeningnewdoorstopossibilitieswithinAPIs(link)
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July28,2017
DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
Source:FGRT
PaymentAppConundrumAaronSiwoku,FounderandCEOofToast7sharedhisjourneywiththecompany,andhisgoalforgreaterfinancialinclusion.ToastisaSingapore-basedremittancestartup(whichalsooperatesinHongKong),whichletsforeignworkerslivingoverseassendmoneyhomeeasily.Siwokupivotedawayfromblockchaintechnology,ashedecidedthatblockchainhasyettobecomemass-marketsuitable8,duetoregulatoryconcernsandslippageissues.
Toastuseslegacyinfrastructuretodigitizeforeignworkers’transfersofremittanceshome.SiwokubelievesthattheremittancemarketisworthUS$29.8billion,comprisingofthesixprimarycorridorsofChina(US$19.4billion),India(US$3.8billion),thePhilippines(US$1.2billion),Malaysia(US$1.1billion),Bangladesh(US$0.7billion)andIndonesia(US$0.3billion).
Toastbuiltaself-servicekioskinitsstoresopeoplecanuseapreloadedcardtohandlethetransactionin10seconds.Otherremittancecompanieswhichrunonanagentmodelmaytakeaslongasthreetofiveminutespertransaction.
Toast’sfuturestrategyistoservetheunderbankedinmultiplecountries,createanactiveuserbaseandprovideauxiliaryfinancialservices.Thestartuphasalsoenteredintopartnershipswithotherfinancialserviceproviders.Forexample,ToasthaspartneredwithPrimeCreditinHongKong,soPrimeCredituserscanuseToasttosendmoneyhome.
7Toast(https://toastme.com/hk)8RemittanceFirmToastPivotsfromBitcoin,Raises$850,000(link)
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July28,2017
DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
Source:FGRT
PanelDiscussiononUsingFintechasanEnablerTheAsiaPacificleadersoffintechstartupssharedhowtheyarecooperatingwithfinancialinstitutions(FI)tocreatevalueforthepublic.
DonaldChan,AsiaPacificDirectorofBondIT,sharedBondIT’spositioninginprovidingservicesforbanksandhelpingtoincreaseefficiency,ratherthancompetingforbusiness.BondITisanIsraelidigitaladvisorysolutionforfixedincomethatservesassetmanagersandinvestmentadvisors.
SGLee,FounderandCEOofKoreanfinancialservicesstartupVivaRepublica9,seesitselfevolvingintoamarketplacebetweenfinancialusersandFI.VivaRepublicastartedaP2Ppaymentsystemwith4%marketshareofthetotaltransactionmarketinKorea,andisnowaportalforuserstoobtainloansandinvestinmicroinvestments.HebelievesVivaRepublicahassuccessfullycreatedvalueforusersinKoreabytacklingthelastmileforcustomers,andhasacollaborativerelationshipwithbanksbyprovidingdigitalinnovation.
TsuyoshiYokokawa,CofounderandCEOofAlpacaandformertrader,sharedhowhisstartuphelpsFIsbuildAItradingmodels.HebeganbystatingtheproblemthatFIshaveintrading:manybanksandfundshaveoverheadsintrading.Byautomatingdecision-makingprocesseswithAI,Alpacahelpstradersimproveforecastingaccuracyandletsbanksreducetheiroverheads.
9Korea’stopfinancialservicesstartuplands$48MfromPayPalandothers,TC(link)
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July28,2017
DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
Source:FGRT
PanelDiscussionontheWin-WinCollaborationBetweenBankandFintechDuringthepaneldiscussionabouttherelationshipbetweenbanksandfintech,establishedincumbentssuchasVisaanddifferentstartupssharedtheirviewsontheissue.
PaulJung,HeadofProducts,NorthEastAsiaatVisasharedhowVisaisactiveinrecruitingtalentfromthefintechspaceandhasbeenopeningitsAPIplatformVisaDeveloperforstartupsandFIpartnerstotapinto10.ThecompanyrecentlytookasmallstakeinUSblockchainstartupChain,andisdevelopingaplatformforbankstosettlepaymentsacrossbordersusingblockchaintechnologycalledVisaB2BConnect11.JungbelievesblockchainisaninterestingB2Bsolutionforpaymentsandcanbeextendedtoloyaltyprograms.VisaisalsofocusingonAI,andhasbeenworkingwithvendorsandFIsonhowchatbotscanreducecosts.
HenriArslanian,Fintech&RegTechLeadatPwC,beganwiththestatementthatforFIstobesuccessfulinfintech,therehastobeaninternalchampiontolead.Agoodexamplewouldbeforacompanytohaveaninternalchampionspeakwitheachbusinessunit,identifypainpoints,maketherightintroductionsandhelpmanagetheprocessofstartupsmaneuveringthroughtheorganization.RecenttrendsthathehasseenrecentlyincludemorebreakthroughsinRegTech,asRegTechhasacostreductionargument,andmanyfintechstartupsmovingtoB2B,astheclientacquisitioncostforB2Cishigh.
KelvinTeo,CofounderofFundingSocieties—Modalku12,aSoutheastAsia-basedcrowdfundingplatformforSMEfinancing,believesthatFundingSocietiesiscomplementarywithFIs,andhassignedpartnershipswithDBSinSingaporeandRHBinMalaysia,amongstothers.Inthenearfuture,Teobelievesthattheindustrywillseeaconvergenceasstartupsandinstitutionsbecomemoresimilar.
10NewVisaDeveloperVideosShowEagernessToOpenAPIstoStartups(link)11Visa’sMassiveBetOnB2BBlockchainPayments,PYMNTS(link)12https://fundingsocieties.com.my/
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July28,2017
DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
AlexCampbell,ManagingDirectorofAsiaforonlineaccountingsoftwareXero13,saiditmakesalotofsenseforfintechstartupsandFIstoworktogether,astheyhaveamutualclientbase.Heseesanemergingnear-termopportunityforstartups,asFIsaremovingfromclosedtoopensystems,whichcreatesmanyopportunitiesforstartups.
Source:FGRT
PanelDiscussiononWhatIsNextforFintechInthelastpaneldiscussionoftheday,HongKong-basedregulatorsandleadersofvariousfinancialserviceproviderssharedtheirthoughtsonthefutureoffintech.Asharedobservationbythepanelistswashowquicklyacountryadoptsmobilepaymentsdependsonthehabitsofitspeople.TheycitedChinaandIndiaasexampleswherebybothcountriesalmostleapfroggedtheuseofcreditcardsstraighttomobilepayment.
SeanSeah,HeadofDigitalExperienceatHSBC,talkedaboutthecommunityandsocialnatureofmobilepaymentbasedonhisexperiencewithHSBC’sP2PpaymentappPayMe14.Heisalsoseeingmanyusecasesforblockchainintradeandsupply-chainfinancebycreatinganewleveloftrustandreducingthevolumeofpaperwork.
SammyKam,TechnicalDirectoratOctopus,talkedaboutthemobilepaymentappO!ePay15,whichiscomplementarytoOctopusstored-valuecards.HeseeshugepotentialforOctopustoscaleitsmobilepaymentsoperations,asuserscannowpayatretailoutletswithO!ePaybysimplyscanningaQRcode.
13https://www.xero.com/hk/14FundtransfersmadeeasyasHSBCrollsoutP2Papp(link)15OctopusmobilepaymentappO!ePayraisestransactionlimitamidintensifyingcompetitioninHongKong,SCMP(link)
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July28,2017
DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
DeborahWeinswig,CPAManagingDirectorFGRTNewYork:917.655.6790HongKong:852.6119.1779China:[email protected]
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