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Fintech in Asia

Britain and Singapore recently announced an agreement designed to help UK fintech firms expand into the Singaporean market and vice versa. With the rise of tech-savvy middle classes and the growth possibilities surrounding unbanked populations, Asia’s fintech market is expanding rapidly. The Money Cloud investigates fintech in Asia, focusing on two of the region’s hotspots: China and Singapore.

Fintech in Asia

China is rapidly consolidating itself as one of the leading global fintech hubs – in a KPMG report published last December, seven of the world’s fifty top fintech companies were Chinese. The 2014 survey saw only one make the list. China’s racing ahead in app development and peer-to-peer lending in particular, with tech giants like Alibaba turning their attention to financial services. Mobile payment technology is also hugely popular; in 2015, 65% of money transfers through Alipay – Alibaba’s online payment platform – were made via mobile.

Alongside Hong Kong, Singapore is one of the most attractive financial centres to those entering the industry or the Asia-Pacific region. It’s home to a number of start-ups and is drawing considerable investment, including from various global banks. UBS, for instance, set up a lab there last year to create new tech products.

Other Asian markets are also booming. India, for example, has one of the fastest growing fintech markets worldwide. Payment processing and banking products – used to streamline business operations – dominate the sector.

Britain and Singapore’s partnership

The UK and Singapore have forged the world's first ‘fintech bridge,’ which is a partnership designed to foster creativity and create footholds in each other’s markets. It includes an agreement between the UK's Financial Conduct Authority (FCA) and the Monetary Authority of Singapore (MAS) to share information on financial services solutions and help companies become authorised.  

What next?

As is the case across the world, Asian fintech needs increased regulation. In China, regulators are starting to crack down on companies with poor lending practises. Meanwhile, the managing director of Singapore’s central bank says that only companies of a certain size will be regulated, seemingly to avoid suppressing innovation.

To keep customers happy, Asian banks need to increase security and evolve. This is particularly true of those in emerging markets with low bank concentrations: financial organisations could be disrupted by start-ups offering services like peer-to-peer lending, cheap international money transfer and online banking.

Keep up-to-date with the latest financial news by regularly checking our blog. There’s also no need to worry about regulation with The Money Cloud, as our brokers are authorised and regulated by the FCA. Contact us for more information.

By Huw Jenkins – Huw has over twelve years’ experience in the FX space and was a pioneer in developing the first money transfer comparison website, before co-founding The Money Cloud with Emmanuel Addy.

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