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The race is on...

Hong Kong to Singapore Comms For Good ● FemTechGlobal ● Coinfloor ● GBG Glory Global Solutions ● MULTOS Consortium ● Wirecard ● Exagens

INSIDE Money20/20

DBS Bank ●


Singapore: A fintech super nova As Money20/20 prepares to launch its first show in Asia, Content Director Pat Patel tells us why he believes the APAC region’s fintech star is rising Fintech Finance: Money20/20 already successfully runs events in Europe and the US. What convinced you to bring the show to the Asia-Pacific (APAC) region? Pat Patel: Firstly, there was huge demand from our clients and, secondly, it’s quite possibly the hottest region in the world right now in terms of advancements in and application of technology, particularly fintech and techfin companies, which are fundamentally altering the financial services landscape. The different maturity levels of infrastructures across the region has created a wealth of opportunities and that’s been enabling a great deal of innovation, from the two leading tech giants in China to the world’s largest open platform in India. So, from our perspective, it’s a no-brainer to be here. FF: Why choose Singapore specifically to host the event? PP: We evaluated at least five locations and came to the conclusion quite rapidly that Singapore had everything we needed. Its location meant it would be accessible and we really liked the venue, too. When we made the decision to come here, back in 2015/2016, we had a good feeling that Singapore would be rising as a fintech hub over the coming years and that’s proved to be right. Singapore wasn’t really anywhere on the fintech map in 2015; now its one of the most important hubs in Asia, if not the world. FF: You have a diverse mix of speakers on the platform. Who are you most looking forward to hearing? PP: Yes, we have Asian banks, tech giants, the rising stars, fintech startups, the global VC community, regulators and ecommerce players. And we’ve brought along a number of the European and US financial services communities, too. If I had to pick one speaker, though, then it’s Tony Fernandes from AirAsia, who will be delivering what promises to be an


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inspirational speech about his entrepreneurial journey. He will also be talking about a project that AirAsia is working on called BigPay, which is its first foray into financial services. It thinks it’s going to be worth more than the AirAsia business, which currently is valued at US$2billion. When you consider what Tony has achieved in taking a debt-ridden company to a US$2billion valuation in such a short space of time, despite the compliance, regulatory requirements and barriers in the sector, then they probably do have the necessary skillset to successfully become a financial services powerhouse. FF: Diversity is a big buzz word in the industry at the moment. Did you deliberately set out to include more women in the speaker line-up or is that something that just happened? PP: We absolutely focussed on it – we have that diversity within our own teams – but it was really challenging when you consider the industry is even more male-dominated in the Asia region. We have somewhere between a 20 per cent and 23 per cent male-female split, which still means we’ve a long way to go, but it’s a good start. FF: What do you think will be the key trends and talking points to emerge from the conference? PP: For me, there’s one big theme and that is the rise of tech platforms and marketplaces and the super apps that they enable. It’s these super apps that are beginning to blur the lines between consumers’ social life, retail life and financial life and this is evident in, say, how Alibaba Group has moved from retail into financial services with Ant Financial – which, incidentally, has just announced its seeking to raise $5billion, which will value

it at somewhere between $80billion and $100billion. That’s larger than most of the banks in the world. It’s nothing short of phenomenal and that’s obviously one of the reasons why we’re drawn to the region. But the other angle on this whole blurring of lines narrative is what Tencent is doing, moving from social media and, to a degree, retail into financial services through WeChat. The key thing about these kinds of platforms and marketplaces is the frequency of interaction that they can enable with customers because of the breadth of their offering. That gives them the ability to provide new propositions, but it also gives them the ability to gather valuable customer data to be able to inform the decisions they make on new product sets and upselling opportunities. Alibaba and Ant Financial have been investing in companies like Paytm and Kakao Pay. Meanwhile, Tencent is doing something similar with a company called Hike, as well as Flipkart and Go-Jek. We’re seeing models very similar to Ant Financial and Tencent occurring across the region now, where financial services starts to become embedded into a consumer’s lifestyle. There’s already been lots of talk around invisible payments and, for instance, what Uber did for the payments world. The next trend we’re seeing is financial services embedded into our everyday life experience, like hailing a cab, booking a restaurant, shopping or saving for your next holiday. Money20/20 Asia covers not only those that are creating this change, but also the response from the incumbents, which is just as important.

How are banks and retailers, payments companies and card schemes responding as they start to slowly move down the value chain and lose the touch-point with the end customer? Then there are the mobile wallet players – the likes of Google and Samsung. What does it mean for the players that have invested so much in these wallet products and how can they drive frequency and meaningful interactions with their customers? Naturally, we’ll be covering all the key areas that Money20/20 traditionally does, from artificial intelligence (AI) to risk and security, legal and regulatory. In addition, we’ll be covering open banking in detail and benchmarking innovation as well as blockchain and Bitcoin. FF: Is there anything those of us who have visited Money20/20 Europe and Las Vegas will notice as being different about the show? PP: One of the things that we’re trialling for the first time at this event is having a key theme that runs all the way through day one and day two from the main stage to a track room. Naturally, we’ll cover other topics but the rise of the tech platforms is a key theme. We start off with some of the banks and how they’re responding to the threat from the tech giants. Piyush Gupta, chief executive and director of DBS Group, will be talking about competing in a new financial services playing field and how DBS is responding to the rise of the tech platforms. Then we have Derek White from BBVA talking about how banks can be a threat to the big tech platforms. We have the Japanese giant Rakuten, which has its own social media platform in Viber, an ecommerce business and a fintech business, giving its perspective on the future of financial services. That will roll into what Ant Financial is doing. Listening to Ant Financial’s chief technology officer is probably one of the sessions I’m looking forward to most, because this was the guy that built the Alipay wallet back in 2008. From that main stage we move on to a whole day of track sessions that bring to life what some of the card technology players and the US

giants – WhatsApp, Google and Amazon – are doing, plus a whole host of the rising stars in the region, from Grab to Go-Jek. Many of those seem to be expanding their proposition from their core models, whether it’s ride hailing, or social media or ecommerce, into financial services and payments. That narrative plays all the way through to day two where we’ll have the chief technology officer of ICICI Bank alongside fintech guru Chris Skinner. We’ll also have Stripe on the main stage, talking platform economies, and Tencent discussing its social media platform and how it’s looking to build that out. One of the highlights on day two will be Ant Financial hosting a technology forum on site. It’s a three-hour block of sessions, hosted by Chris Skinner and includes a number of Ant Financial domain experts, which will cover blockchain, AI, security,

Singapore wasn’t really anywhere on the fintech map in 2015; now it’s one of the most important hubs in Asia, if not the world Internet of Things and computing. These are the key areas that Ant Financial is investing in to develop its tech and platform capabilities. It should be a really good deep dive. We’re also trialling a new stage, which will provide a place for intimate Q&As with some of the keynotes after they’ve finished their main stage presentations. We’ll also have a few sessions to celebrate failure! I know that sounds strange, but in some parts of the region we’ve noticed a big stigma attached to failure and taking risks. To that end, we wanted to celebrate entrepreneurs that have failed spectacularly and then gone on to succeed. The founder of Viva Republica, for example, had a number of failed ventures before building the super-successful Viva Republica and now he’s even attracted investment from PayPal. He’d never had the opportunity to talk about those early failures. Now, hopefully, he will inspire others to take that leap of faith and learn from his setbacks.

You hear some sad stories of entrepreneurs who have failed in their first business and just given up in part due to societal pressures. If we can create a little bit of change around social attitudes to business failure that would be pretty cool, but just to get some exposure and awareness could make a difference. We also have workshops running throughout the event to drive deep learning experiences on specific topics. In addition, we’re hosting a large number of meetups, which will be led by some of our speakers from our stages, addressing topics that might not have been covered in a session and, most importantly, to encourage networking and chance encounters. Serendipity is the spice of life! FF: As well as Asia this year, you have Money20/20 China coming up soon. Is an entire show dedicated to one country an acknowledgement of the sheer scale of what’s happening in China? PP: Yes. Although Money20/20 Asia will cover aspects of China, we felt that with all the activity going on in pretty much the largest fintech market in the world, that it warranted its own event. While the likes of Ant Financial, Tencent, and China UnionPay will travel outside of China, there’s a whole raft of companies that wanted an event held in and for the domestic market. We’ve had a lot of support from the Government and many of the players, such as LianLianPay. We’ll also bring our US community along as there’s been strong interest to get involved. FF: Finally, you’ve chosen a space theme for the show… why? PP: Each year we try to outdo ourselves in terms of the thematic. Last year, it was superheroes. Space – the idea of new frontiers and opportunities – seemed to fit nicely with the launch of Money20/20 Asia. It’s created additional opportunities for us – one of which is working with a charity called Space For Humanity, which is trying to democratise space travel by sending ordinary people up there. Money20/20 delegates and those that engage with us before the event will be invited to submit a three-minute video telling us why they should be on that trip. We will announce at the show the person who gets fast-tracked to the final and has a great chance of going into space. How cool is that? Issue 8 |


MONEY20/20 ASIA SPECIAL Singapore or bust: But which payment method will triumph this time?

And they’re off...

from Hong Kong to Singapore The Money20/20 Asia Payments Race is on! In this, the third of Fintech Finance’s cross-continental challenges, our fearless competitors can travel by planes, boats, trains, tuc tuc and even elephant as they put five different payment methods to the ultimate test

Amélie Arras Payment method: Cryptocurrency Sponsor: Coinfloor

Our victor in the last Payments Race from Toronto to Las Vegas, Amélie was powered across the finish line by a community of enthusiastic Bitcoin fans, who she connected with over social media. But she admits the chances of her retaining the title in Southeast Asia following Beijing’s ban on domestic cryptocurrency trading, Hong Kong’s crackdown on unlicensed exchanges and the global cryptocrash – which saw half the value wiped off Bitcoin in a matter of hours – are remote. Undaunted, Amélie is relying on her powers of persuasion to convince people of virtual money’s value. “I’m looking forward to seeing how I can explain Bitcoin and crytocurrency to people who’ve never heard of it,” she


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says. That’s if she can find a common language, of course. “I think that’s going to be the hardest part,” she adds. Amélie is holding on to the fact that in this region, nearly 1.4 billion people (or around 35 per cent of the population) hold smartphones. The likes of Alipay and WeChat Pay have made messenger and payment apps popular with consumers, but familiarity with the technology and a curiosity for new payment options might not be enough to help her achieve her one big ambition along the way – to take part in a Vietnamese cooking lesson.

“I’m desperate to go to Vietnam to try the food,” she says. “But from my previous experience in Asia, it’s very cash-driven. As long as they’ve a mobile phone, though, I’m hoping I can persuade them to download a wallet and get them to accept my payment.” ■ Amélie Arras is an international market strategist and founder of the specialist fintech and payments agency, Adastra Marketing. She advocates digital transformation and collaboration in the financial and payment world.

Coinfloor is delighted to be sponsoring Amélie’s bid to retain her champion title from the North America Payments Race. We’re excited to watch her journey across Asia with Bitcoin. Good luck, Amélie! OBI NWOSU, CEO, COINFLOOR

Stuart Thomas

Payment method: Cash Sponsor: Glory Global Solutions

Veteran payments racer Stuart Thomas completed both previous challenges using cold, hard cash. And he’ll be attempting the feat again in Asia. But, this time, the maths are more complex. He’ll potentially be paying his way with seven or more currencies: the Hong Kong dollar, the Chinese renminbi (RMB); the Lao kip; the Vietnamese dong; the Cambodian riel; the Malaysian ringgit; and the Singapore dollar. The mental arithmetic is daunting. “I’ve never been through that many currencies in such short a space of time

before,” says Stuart. “Obviously, it takes a while to adjust to a new currency system whenever you enter a country, so I think I’m going to find it quite difficult – especially when it comes to keeping track of what I’m spending against my allocated budget. The key will be keeping a good record.” The one problem Stuart won’t have is getting vendors to accept his coins and notes, especially on the initial stage of the journey. China was, after all, the first economy to print paper money a millennium ago and, despite a steep rise in the value of digital payments across the region and China’s position as the world leader in mobile payments (transactions total nearly 50 times those in the States), it’s still common there to find trunkloads of cash being used to pay for high ticket items, such as cars. That said,

with the Chinese Government actively encouraging consumers to switch to digital transactions, the writing may well be on the wall for cash. “I still believe it’s is the most versatile payment method,” says Stuart. “And I want to prove that on this race by getting from A to B while doing the most varied number of things, like sightseeing or using different forms of transport, including an elephant. I’m really keen to island hop using the ferries, too, but having taken part in this race before, I’m going to keep all my options open!" ■ Stuart is a technology blogger and YouTube presenter with an international following. He uses situational comedy to test out products and services. You can catch him on his channel, Stu’s Reviews.

Best of luck, Stuart, from everyone at Glory – we’re sure that cash will make you even more popular and will keep you local wherever you go. I don’t think you’ll have any problems in the Chinese New Year of the Dog! BEN THORPE, GLORY MANAGING DIRECTOR FOR ASIA PACIFIC

Amra Naidoo Payment method: Card Sponsor: Baofu

The largest card company in the world, according to RBR, by virtue of the sheer scale of its domestic market and a government strategy to choke off its rivals, is China’s UnionPay. But it’s not just confined to the People’s Republic. Now also prevalent in Southeast Asia, our card racer Amra needs to make sure she has the distinctive red, blue and green logo among her fistful of plastic. An habitual card user herself at home in Singapore, Amra’s biggest concern is going hungry on the trip for want of finding a food vendor that accepts Chip & PIN or contactless.

And she’s right that in the Southeast Asia region especially, where 27 per cent of the population is unbanked but literally everyone has a mobile phone, payment technology has leapfrogged cards completely in some areas, in favour of apps such as social payment sites and QR codes. It’s been estimated that only two per cent of the Southeast Asian nations’ 53 million people carry cards. That said, access to the internet is not universal – only 26 per cent of the population are regular users in Laos and Myanmar – which raises issues of financial inclusion. As an expert in the area of social enterprise, how Asia solves that problem is of interest to Amra. “I would love to visit as many social enterprises as possible along the route,” she says. “There are so many incredible entrepreneurs solving big challenges in Southeast Asia, it would be great to see

how they are applying tech to society’s big issues.” ■ Based in Singapore, Amra creates and executes high-impact marketing and communications strategies in the commercial and social sectors. Her most recent initiative, Project Inspire, is a multi-award-winning social entrepreneurship programme for Singapore students. She is passionate about closing the gap between the commercial and social sectors and has facilitated partnerships between education, government, multinational corporations, including Mastercard and Facebook, and influential media. She is a World Economic Forum Global Shaper and is the creator and presenter of the Doing Good Podcast, which drives awareness of social enterprises and the causes they support.

Amra’s biggest concern is going hungry on the trip for want of finding a food vendor that accepts Chip & PIN or contactless

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Augustus Loi

Payment method: Mobile phone Sponsor: Comms for Good

“Having looked at the Southeast Asian space for fintech for some time, I don’t think that the race has ever seen this diversity of environments, to be honest,” says our mobile payments racer. Armed with nothing but a mobile wallet, his journey depends entirely on vendors having compatible payment points – and that’s not as universal as the region’s extraordinary number of smartphone users might suggest. Credit cards still dominate transactions in Hong Kong, but just 2.3km across Victoria Harbour and the other side of

the Shenzhen border crossing, wallets like Alipay and WeChat Pay are near ubiquitous. You can use them to order everything from dimsum to a movie ticket in mainland China. The country’s mobile payment usage went up 31 per cent in 2016 and transactions there are now thought to be worth $5.5trillion. Alipay alone has more than 520 million active Chinese users and more than 200 financial institution partners in China. Elsewhere, the payments picture is fragmented, especially in rural areas. “And it doesn’t get more rural than in some parts of Southeast Asia,” says Augustus. “I’m not too worried about being able to use mobile payments in the major cities but anything outside of Bangkok in Thailand, for instance, and Ho Chi Minh and Hanoi in Vietnam concerns me.”

That said, WeChat owner Tencent announced in November that it would be rolling out its mobile payment app for local transactions in Malaysia – the first time it’s gone beyond mainland China. “Wherever I go, I’m pretty much relying on the technology providers – Alipay, GrabPay and Tencent – to have penetrated the market,” says Augustus. “As for my rivals, I think cryptocurrency has the biggest battle.” ■ Augustus is a senior manager at the Singapore Government-linked venture capital fund SGInnovate, which focusses on launching, proving and scaling ‘deep tech’ products. In 2015, he won Tyro.VC, a reality competition that pits aspiring venture capitalists against each other.

Best of luck, Augustus! I am sure your resourcefulness and competitive nature will spur you to discover even the rarest of opportunities to use your mobile wallet in rural Asia. KATE BOLTON, FOUNDER OF COMMS FOR GOOD Neha Mehta

Payment method: Gold Sponsor: FemTechGlobal

‘An inch of time cannot be bought with an inch of gold’ according to an ancient Chinese proverb. But payments racer Neha Mehta is hoping to prove Chinese wisdom wrong by using her shiny hoard of ingots to gain an advantage against the clock. She’s in the right region to barter her bullion, too. China was one of the world’s two biggest gold markets in 2017, buying just short of 650 tonnes, while Vietnam’s thirst for the precious metal grew at a faster rate than anywhere else in Asia, rising seven per cent year-on-year, according to the World Gold Council. Hints that the Vietnamese government was planning to liberalise the gold market, a booming domestic economy and a growing number of retail jewellery stores, all drove demand in a country that views gold and American greenbacks as the best pension pots.


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“I come from a country where people like to hold gold,” says Neha. “They go to weddings wearing gold and we believe in having gold at all our social occasions. But when it comes to getting from Hong Kong to Singapore using gold, it could be very challenging.” Her twin concerns are proving its authenticity and transacting small amounts for everyday essentials, such as food. “On the plus side, unlike Bitcoin, people understand gold and it’s respected. So I think it’ll come down to me being able to think on my feet and hustle,” she adds. Neha supports the principle of the race – that consumers should be allowed to choose how they pay. But it's a choice that’s increasingly being circumscribed in Asia as

major economies move towards exclusively digital or card transactions. “The more choices we have, the better,” says Neha. “We can select the best option for us and we feel empowered getting the most out of what is being offered.” ■ Neha is a lawyer by training and specialises in financial regulation. Much of her work now involves lobbying financial regulators as Vice-President of the Indian Private Equity and Venture Capital Association and Country Head for the Alternative Investment Management Association, Singapore. Neha is a regular contributor to fintech debate, especially on bridging the industry’s gender gap.

Neha, you’re the only challenger on the gold standard. No doubt you’ll find that currency has stamina – and so will you. It’s said that fire is the test of gold and during this challenge you’ll face a few adversities, too. But keep in mind the golden rule: the woman with the gold rules. GHELA BOSKOVICH, FOUNDER, FEMTECHGLOBAL


Collaborating in the digital ‘space race’

Sixteen countries shared resources, expertise and ideas to put the International Space Station into orbit. Back on Earth, businesses in the financial supply chain are similarly engaged in a feat of collective endeavour as part of the MULTOS Consortium, as its Commercial Manager Paul Wilson explains Fintech Finance: What is MULTOS and how does the MULTOS Consortium enable its members to enhance their various businesses? Paul Wilson: MULTOS is the trading brand of a secure operating system and management architecture originally designed for smart payment cards and now also implemented for ID cards and various embedded and connected devices. It was devised by a NatWest bank team in the UK more than 20 years ago and is now an open, industry-led standard for highly secure devices. It is unique in that it was designed by a client business for client businesses in order to provide an ‘issuer-centric’, smart card technology platform. Unlike many other similar technologies, it is an open standard with a robust approval scheme that allows issuers or product owners to obtain certified MULTOS products from multiple vendors without having to manage compatibility variances. So, a true open business-enabling technology, preventing ‘vendor lock-in’ over the supply chain. More than one billion MULTOS cards and smart devices have been supplied so far. The MULTOS Consortium is part of the wider MULTOS ecosystem that consists of more than 3,000 businesses around the


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world leveraging the benefits of MULTOS technology. The Consortium is a distinct subset of these companies, including global and respected businesses in their related sectors. They ensure the open standard remains current, the supply chain remains competitive and reliable, and delivery of secure, flexible, quality products and services. The Consortium represents the ‘cream’ of the smart, secure device world. FF: How is the MULTOS technology and its benefits being leveraged by businesses for payment innovation? PW: For the many market-leading and innovative projects, collaboration is required in order to reduce time to market and provide the most secure, reliable, and capable products and services. In 2017, this type of close partnership saw MULTOS being implemented in a smart energy management solution that incorporated a secure energy billing feature. Industry recognition was received for its application within a smart solar panel design by Trusted Renewables, a MULTOS Consortium member, which was given first place in the Trustech 2017 Sesames Awards for best Internet of Things (IoT) application. In recent months, we have also seen MULTOS employed in advanced biometric

contactless payment cards and multi-function wearable connected devices. MULTOS has a strong heritage in the Europay/Mastercard/Visa (EMV) payment card industry and, as such, has perfect synergies with the growing wearable device market that often benefits from having secure payment added as a key consumer feature. Tokenised data fed through innovative provisioning systems is a logical extension of the MULTOS capability, allowing dynamic provisioning of a range of consumer form factors on request. These and other collaborative activities are ongoing today among MULTOS Consortium members. FF: Why is such collaboration so important for the digital security industry? PW: Last year, we launched a short promotional film to celebrate the 20th anniversary of the MULTOS technology. One of our main contributors to the film, who was involved from the early days of building the MULTOS ecosystem, compared it to another collaborative project – the establishment of the International Space Station (ISS), a football-field-sized scientific research centre orbiting in the thermosphere, some 400 kilometres above us. Sixteen countries came together to build

the ISS and it has been in low earth orbit now for two decades. Longer term, the ISS may be used as a staging post to help us build a deep space gateway for further research and planetary colonisation. As with the ISS, collaboration through the MULTOS Consortium can enable great achievements and increase the chance of successfully delivering quality products and services. As consumers, much of our world today is defined by convenience, capability and the availability of information, services, and products. Security is often transparent, assumed as part of the trust we consumers place in the brands and businesses we transact with. Understandably in the digital business world, the need for security is more visible, and those of us working in that world are acutely aware of the increasing cyber threat and the impacts caused by such attacks. The more digitised and connected our environment becomes, the more at risk and open to disruption businesses and consumers will be. As the complexity of the digital security industry increases, we may need to grow eyes in the backs of our heads. Few companies, if any, can be considered all-seeing, all-capable creatures, able to identify and manage every threat, and deliver completely robust, end-to-end solutions. Most businesses have focussed their resources in order to build their success using their core capabilities and expertise. So, the solution to extending a company’s longevity and capitalising on the opportunities the digital world has to offer, is collaboration. With payments evolving, identity developing, connectivity proliferating, and the world automating, the industry press is

crammed with examples of large and small companies partnering through one form or another in order to leverage present and future opportunities. The MULTOS Consortium is one multi-national, multi-business collaboration that has stood the test of time in the digital security industry. Collaboration is a core ethos within the Consortium, an approach that, for 20 years, has allowed efficient project, product and service delivery for businesses. Members work closely on mainstream business activities as well as innovative projects. For example, personalisation bureau companies are supplied with compatible MULTOS products from a number of different member suppliers, and those products may contain hardware and software from various vendors. This compatibility creates an efficient and flexible supply chain. FF: What sort of digital security collaborations do you envisage for the future? PW: We are starting to see some interesting projects and trials develop with some of the banks. They are not just relying on traditional vendors to support their innovation needs, but on groups of suppliers and agile and dynamic companies to break new ground. This is perhaps a mindset evolution. In recent months, the identity market seems to have exploded, with many businesses offering new services and solutions. Solutions components are being leveraged by other suppliers to reduce the time to market for their products and services and fill the gaps in their technical knowledge and development expertise. From a marketing perspective, this makes a

As the complexity of the digital security industry increases, we may need to grow eyes in the backs of our heads. Few companies can manage every threat.The solution is collaboration lot of sense and may well lead to some great business successes for some of these collaborations. After all, identity in the digital security world is absolutely vital. Payment and identity often merge within applications. Systems and people need to be identified for data to be exchanged, and the monetisation of the value provided by applications and information can require transaction management. Traditional payment companies have started to expand their capabilities and collaborate to be at the forefront of this hyper-connected world and provide their consumers with convenient payment solutions, such as in-car payment services. We can expect to see much more of this business interaction. The growing markets of business and consumer connected devices and the IoT represent huge potential. Industry predictions for connected devices in 2020 range from 24 billion to 200 billion, which may rise as high 500 billion by 2030. However, connected devices, regardless of their communication technology, often require increased security protection as they can be at much greater risk of cyber-attack. Security is a core facet of MULTOS and has ensured the technology has remained robust and achieved the top levels of approvals, such as the Common Criteria EAL7. Securing these new markets and opportunities is clearly an area that requires collaboration from the MULTOS Consortium and other companies, and support from industry experts, which is already starting to happen. This is an area where we can expect to see further collaboration and standardisation. The MULTOS Consortium has always strived to foster the ethos of collaboration. With evolution, including the addition of new dynamic members, the Consortium is set to continue providing success for its members, just as the ISS continues to do. Issue 8 |






Engaging or Enraging? How is your online experience making customers feel? GBG commissioned a new study by Forrester Consulting to get to the facts. MD Mick Hegarty reveals its findings New customer identity technologies are coming. In this time of rapid change online, are financial services firms keeping up or losing ground? To answer this and other related questions, identity data intelligence specialist GBG commissioned Forrester Consulting to survey 315 financial services firms in Singapore, Australia, China, the UK and USA. Just published, and entitled Leaders In Financial Services Are Experts In Customer Identity, the study was split 50/50 between traditional firms (established in the pre-digital era) and ‘born digital’ fintechs.

Onboarding is the key According to the Forrester study, to prosper financial service firms need to onboard their online customers seamlessly. Making them feel welcome and at ease from the start is the first step to building long-term relationships – creating a customer experience that exceeds their expectations. The stakes are high and the study doesn’t pull its punches, stating that ‘financial service firms will live (or die) by delighting customers via digital channels’.

Customer expectations rising The Forrester study points out that customers regularly enjoy great experiences with the likes of Amazon, Apple and Facebook, and won’t accept less from financial service providers. Positively, firms around the world recognise this and many are planning to increase their spending on the digital customer experience. The USA leads the way here with 83 per cent, just ahead of Singapore, Australia and China.

Identity is the battleground, technology is the key Around the world, financial services firms understand that customer identification is the key to successful onboarding and that innovative technologies are vital at this stage. However, few firms, even fintechs, are currently mastering identification and verification of customers. Onboarding speed is critical and Chinese firms seem to be ahead here: 27 per cent are able to onboard customers in a matter of minutes, compared to only six per cent in Australia.

Financial services firms will live (or die) by delighting customers via digital channels Customer identity challenges Perhaps the most troubling finding was that, globally, 86 per cent of firms are concerned about their ability to identify customers. Ninety-five per cent in the Asia-Pacific region (APAC) admit they are unable to maintain customers’ data privacy. Despite these perceived problems, the study shows that APAC-based firms

are outperforming their US and UK rivals in the crucial area of adopting innovative technologies such as facial recognition, iris scanning, voice recognition, fingerprint biometrics and behavioural monitoring. They are also well ahead with emerging technologies, such as blockchain and robotic process automation. Despite their worries about data, APAC-based firms show considerable confidence when it comes to embracing the future of customer identity and onboarding technology. Sixty-six per cent feel that they have the necessary technology to execute their customer-centric strategy, compared to 44 per cent in the UK and USA. Always thought-provoking, the Forrester study summarises the situation like this: “The faster a financial firm is able to unlock a customer’s identity, the sooner that firm can deliver the valuable experiences and benefits customers expect.” These issues are sure to be among the major talking points at Money20/20 Asia, and at other industry events over the coming months. Read the study now, and make sure you’re armed with the facts. ■ Download the Forrester study at Issue 8 |



All ‘hail’ fintech! While I know everybody is addicted to Game of Thrones right now, I can’t help thinking it’s got nothing on the real-life battle Game of Tech Thrones playing out in Southeast Asia. This one pitches the dragons of Chinese tech against the lions of Silicon Valley (sorry for the stretched analogy – I really have been busy during my recent sabbatical, but what a battle scene in episode four!). Amazon’s entry to the Southeast Asian market puts it head to head with Alibaba and Lazada. It pitches the newly-crowned richest man in the world, Jeff Bezos of Amazon, against the freshly dethroned richest man in China, Jack Ma (recently replaced by Tencent’s Pony Ma). But it’s about more than just two companies. Southeast Asia is a battlefield for Western and Eastern tech and fintech. And when I talk about Western I really mean Silicon Valley because Europe has made very little impact when it comes to fintech and ecommerce in this part of the world. The likes of Uber, Airbnb, even Facebook and Stripe, have pioneered and disrupted industries and they’ve grabbed attention (sometimes for the wrong reasons). They have a strong marketing and user experience lead. But as Henry Ford was purported to have said, if you asked customers what they wanted before the motor car was invented they would have said ‘faster horses’ – in some ways Western tech and fintech is about designing faster horses. That said, they are brilliant at it. We are all familiar with the ways in which Amazon uses consumer data on buying patterns to


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Neal Cross, Chief Innovation Officer at DBS Bank, on who will take the tech crown in Southeast Asia propose purchasing choices and makes data available to merchants to help them list their products in the right way. Chinese tech companies, such as Alibaba, have been more cautious with their international expansion. Why? Partly because the nature of Chinese tech and fintech suits their local market so well. It’s about getting stuff done. They are brilliant at coming up with completely new ways of getting what you want in the digital environment. But, visually, the product doesn’t translate, functionally it is different

The way Chinese companies are using data is streets ahead and the journey to get there is one non-Chinese users are not familiar with. In my opinion, though, the way Chinese companies are using data is streets ahead. The integration of online ecosystems in China and the way Chinese consumers are sold to – combining social media, entertainment and personalisation – is in a different league to anything we see in the West. At its recent Global Netrepreneur Conference, Alibaba Group CEO Daniel Zhang said: “We are moving from satisfying

needs to creating needs.” In other words, it’s pre-empting what you need before you know you need it and then selling it to you. The problem is replicating that success outside of China. As we know, both Amazon and Alibaba have hugely deep pockets. It is interesting to see Lazada, which is now owned by Alibaba, sharpening its claws in the face of Amazon’s market entry with LiveUp, which offers subscribers rebates and other benefits on Uber and Netflix and expedited and free delivery on Taobao, as well as its own platform. Added to the mix are some of Southeast Asia’s home-grown tech companies, which are quietly forging their own way by adding a Southeast Asian flavour. They don’t necessarily have the gargantuan budgets, but they do fit the local market. The ride-hailing companies Grab and Go-Jek are great cases in point. Go-Jek is dominating its Indonesian home market with a truly localised model, while Grab is giving Uber a good run for its money in Southeast Asia. Personally, as a user of both Uber and Grab, I think Grab is better in the way it can predict my next destination and remembers where I have been to make suggestions. Uber, for all it was a front runner, has stuck to an interface that is not as user-friendly. How annoying is it that you have to enter a destination before you can update your current location? As we square up for a battle royal between the big tech titans of East and West in Southeast Asia, I’m excited about what new and creative ideas and opportunities will emerge as a result. That will be worth watching!

Photo: Courtesy of Go-Jek

Fast work: Go-Jek’s hyperlocal model caught on rapidly in Indonesia


All for one and one for all

A universal POS, capable of accepting any form of payment, regardless of channel, could harmonise Southeast Asia’s diverse transaction landscape. It’s a challenge Wirecard accepts, as MD Jeffry Ho explains

The dream of a cashless society is moving closer to reality – especially in Singapore, host city of Money20/20 Asia. Here, consumers long ago embraced tech such as contactless cards, making the city state an e-payments leader in the region, alongside South Korea and Japan. But travel only a few kilometres to neighbouring Malaysia and you find a market where small retailers still rely on cash and 70 per cent of SMEs do not yet have a website. The picture is similar in Vietnam, Thailand and Myanmar – fast-developing markets with their own distinct payment systems. What they share, however, is high ownership of mobile phones. “Asia is so fragmented, every country is different, from currency to financial

regulations,” says Jeffry Ho, managing director of Wirecard in Singapore and Malaysia. He is attending Money20/20 to let potential partners know his company is active in the region and can use its local knowledge to make sense of distinct financial traditions and compliance frameworks. “Wirecard provides a common platform with the ability to localise to the country’s regulatory perspective and also the various payment methods being used. “We are international but with local knowledge,” he says. Headquartered in Munich, Wirecard is a global technology group that supports companies in accepting electronic payments from all sales channels – offline, online or with mobile technology. For

organisations seeking to issue their own payment instruments in the form of cards or mobile solutions, it offers end-to-end infrastructure, including the issuance of licences to take payments.

A cashless society Ho says the world is on a journey to a cashless future, and though some countries have further to travel, the incentives, such as shrinking the black market and tax evasion, are powerful drivers for governments to accelerate that transition. “In Asian countries, the adoption of new payment methods is being driven primarily by regulators,” he says. “They are very proactive in looking at ways to popularise e-payments. So, from QR codes to near-field

Common platform: The market is converging on a single universal POS


| Issue 8

communication (NFC), regulators are engaging the payment players. Some regulators are even setting targets for bank acquirers to increase acceptance points, that’s how proactive they are. “Thailand has adopted targets for acceptance points for cards. In Singapore, the Government is incentivising people to go further with e-payments. In fact, I think the e-payments ratio will increase quite rapidly over the next few years in Asia.” The potential e-payments roll-out in Asian countries, based on population statistics and mobile phone penetration, is astonishing. Beyond the giants of China and India with close on 1.4 billion people each, Indonesia has 260 million people, while Vietnam and the Philippines have around 100 million apiece. Ho says: “Imagine the benefits for those countries if they have to adopt electronic payments. They greatly reduce the cashflow, especially as the value of their currency is not as strong as in the US and Europe. “When you visit these countries, such as Myanmar, India, China and so forth, you see people carrying bags of cash to the banks. So this is a tremendous motivation for them to go electronic. “When a population is very spread out, bringing cash across a country is high cost. It is also very hard for a government to keep track, from a money laundering perspective. So electronic payments are being seen as the answer to better productivity, efficiency and compliance.” Having no past history of non-cash payments is not a barrier to e-commerce development, says Ho, since new systems can leapfrog earlier tech in the same way that people in Third World countries had mobile phones without first having a landline. In fact, mobiles hold the key to progress, he says, if the payments infrastructure can be developed. “In Malaysia, for example, few people currently use their mobile devices to make mobile payments. But the country is home to nearly 20 million mobile internet users and it offers more 4G coverage than most other countries in the region. “Introduce a mobile payment method that is secure, reliable and affordable and Malaysia’s payments market could undergo rapid transformation.

“In comparison, creating the infrastructure for card technology takes longer. For a credit card you need to acquire a customer and issue the card, then you need a secure point-of-sale device to be deployed in shops. “Take one of these new payment methods, such as QR code for example. It’s a hybrid between mobile payment and card payment. In the last 10 years, mobile phones have soared in popularity to the point that almost everyone has one. So it makes sense to equip the phone, rather than taking another route, such as issuing a card. That’s why, in Asia, leveraging the phone population has been a major success factor for the systems that have done so.” Ho says two systems that amazed the industry with their rate of growth were Alipay and Tencent’s WeChat application, both in China. He admits the building of an ecosystem there was made easier by a lack of existing incumbents. “But in a lot of countries it’s a mixed bag,” he says. “In Thailand, the more fluent merchants are already equipped for card payments. It is a bit like Europe and very

We find merchants want to deal with an impartial party so that their interests are protected and they can take payment via as many methods as possible much like the US. So the need for another payment method is not so urgent. Therefore, we get a wider spread of payment methods being used across other Asian markets, rather than just one dominant player.” This brings him back to Wirecard’s proposition to potential partners. It offers a payment system that consolidates the various payment methods in one device for the retailer. It simplifies the process for the vendor and brings down the price for payment method providers because they can be incorporated into a Wirecard system with no need to roll out their own hardware.

Ho says: “One of the roles Wirecard has been playing is universal provider to link up all these different payment methods. That means the merchants or the acceptance points have one single point of contact, which also lowers the cost of enablement because they’re dealing with one party. “If there’s common equipment – scanners and so forth – they can all leverage it. That’s what we see as we engage the marketplace; we find merchants want to deal with an impartial party so that their interests are protected and they can take payment via as many methods as possible. “For the payment methods providers, whether they are card schemes or wallets – and today wallets are springing up everywhere, especially on a local level – they would want to be enabled at as many acceptance points as possible, rather than going out directly on their own, which increases the acquisition cost tremendously.” Ho says the move towards collaboration and partnership has developed in the last decade as more payment systems have come to market. “By entering into partnership with us, firms can focus more resource on promoting their payment method. That means more marketing, PR, branding exercises and so on, so users are educated and incentivised to use the system. “With companies like Wirecard, and the technology that’s available to create universal platforms, customers can aggregate all the payment methods, irrespective of channel, not just over the counter, but electronically, online and through mobiles. And it means we have been able to significantly reduce the cost of enablement. You see it especially with the bigger merchants. If you go to a large store, you’ll often see many payment devices congesting the retail space because different payment providers have each installed their own equipment. “Right now we are seeing consolidation with increasing adoption of what we call a universal point of sales or universal point of acceptance. The market is moving towards multi-point devices.” ■ Wirecard can be found on stand G40 at Money20/20 Asia. You can get in touch via to arrange an appointment. Issue 8 |



Taking it to the Max To call Exagens’ personal financial assistant a ‘chatbot’ is to insult its cognitive intelligence. Here, CEO Michael Stojda, explains why talk is cheap but the real value is in personalised customer engagement Extracted from conversations we’ve had with a broad range of financial institutions, we’ve identified what we believe are five consistent trends emerging in banking that are translating into opportunities for financial institutions, as well as driving Exagens’ focus.


| Issu Issue 8

Founded by a team of finance industry veterans with the goal of being at the centre of an unfolding revolution in banking – Exagens assists financial institutions in navigating and shaping this exciting future, by helping them to ensure they keep their customers with them through all these changes. The most prevalent of these trends is the shift in the frequency of transactions, as well as the migration of customer interactions from branch to ATM, to web, to mobile and now to other digitally-enabled touch points. Each past shift has not resulted in the extinction of a previous touch point, but often only a reduction in its use. This has been a huge challenge for traditional banks; while their customers may now only visit a branch once or twice a year, they still want (and expect) the branch to be there when they need it – and with convenient hours. We have even seen some banks, after significantly upgrading their digital offering, then launch a marketing campaign to say that they are open seven days a week with longer hours. Banks have been investing in digital to reduce costs and they have taken broad swipes at resources in the branches and call centres to decrease human resources costs. But the reality is that the more customers use digital channels, the more they seem to want human interaction. Banks need to get the digital experience right to attract and retain customers. However, the branch

continues to play an important part of the overall customer experience. The challenge for financial institutions is how, at the very minimum, they maintain and, hopefully, increase the client value and relevance of those branches, while simultaneously adjusting the costs to reflect today’s realities. A big challenge is finding the correct tipping point to achieve this delicate balance.

Evolution or revolution? Long gone are the days of single-relationship banking clients because it is increasingly easy for those clients to compare what appear to most consumers to be similar products and services, and then switch and transfer between providers with electronic ease. It is no surprise that the average consumer (especially in North America) has financial relationships with multiple institutions, and the number keeps growing. Some financial institutions have responded to, or have been created to be, the lowest cost providers, relentlessly driving down pricing to gain competitive advantage from a few basis points. For others, it’s about seeking ways to add more than just transactional services and digital convenience, in order to be trusted as providing value in the management of customers’ evolving daily financial lives. The third trend is how financial institutions (FIs) are striking the balance between potential technology benefits and the cost and risk of introducing them. Most banks have experienced the graveyard of technology projects that failed to deliver as promised or envisaged – or were never fully realised. Although aware of the constant need to evolve, banks can become overwhelmed with the adoption of new technologies and how to effectively integrate them into their organisations. Many are looking at how to evolve in bite-sized chunks rather

than massive, multi-year infrastructure changes whose benefits may take even more years to be realised, and can be difficult to quantify and monetise. Our fourth theme is the unlocking of new value from existing channels and infrastructure. As consumers continue to demand an ever-increasing range of channels, there will be added focus on extracting bottom-line value from existing ones. And, finally, the most relevant trend is the challenge faced by banks around sustaining valued relationships over time with their customers. Relationships have been core to banking, but although we are seeing great strides in targeting and timing through next best offer and next best action predictive analytic systems, it often takes much more than that to ensure product acquisition and adoption. It takes trust, relevance, context, and empathy, all built over time. A lack of deep and granular insight into customer preferences and behaviours means many banks are unable to deliver the services and experiences their customers want. Banks that are looking to chatbot technologies are often focussed on two prevalent areas. The first is all about making it faster and more convenient for clients to interface with a bank to do their banking – in this case, using natural language processing via text or voice. But this is merely another incremental step forward on a journey that started with the first ATM: taking something people inherently prefer not to do – banking – and making it less inconvenient and faster. The other area is all to do with cost reduction; specifically, reducing call volume by introducing chatbots with skills approaching those of an entry-level customer service representative. The focus here is on working to understand what a person is saying and being able to respond to it.

platfor, we’re enabling banks to provide their retail and commercial clients with their own AI-empowered personalised advisor and, in doing so, step out of the commoditisation conundrum. After all, if a bank was able to provide each of its clients with their own, private banker, tasked with delivering individualised advice and assistance – one who knows them, empathises with them, understands the evolution of their financial life and is able to capture opportunities to ensure that every customer experiences its full value – what is the likelihood that client would shop elsewhere or be lured in by a few basis points differential? What if you could, for each of your customers, increase awareness of the products and services that they already own but may not optimally utilise, thus increasing the customer’s engagement and potentially reducing future support issues? Furthermore, if a client is interested in purchasing a product or service, the platform works to build and support that interest all the way through to acquisition in whatever amount of time it takes, over a period of days, weeks or months – adjusting to the client’s time, interest and intent. It will even handle most or all of the acquisition process for them – eliminating points of friction to reduce abandonment and increase satisfaction. A great example is the recent work we did with a tier one financial institution in Canada, generating an additional $250million in deposits into new retail and commercial accounts without the need for additional incentives. The platform also helped clients complete an additional 20 million transactions in bill payments and transfers for 1.9 million users through better use of existing functionalities.

It is no surprise that the average customer has financial relationships with multiple institutions and the number keeps growing

A personalised financial advisor Exagens is focussed on something more fundamental: the financial journey of each individual client. Put another way, with the Exegens Max

It pays to talk An advisor in a branch can talk to eight different people over a day and the best call centre specialist maybe 80 – what if you could talk to thousands of customers per minute? As with a private banker, ongoing client engagement is core – through relevant, contextual and individualised interactions. Exagens’ platform offers advice on individual-specific opportunities and services, developing ongoing conversations to maintain and secure the relationship between the client and their financial institutions. Yes, of course, Max converses with clients – but the objective and the way it is done is very different.

I, Banker: Max is proving clients can have a relationship with a ‘machine’

Issue 8 |


Bank Transformation Platform

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Making connections: Max anticipates what the customer needs

We are using artificial intelligence (AI) to anticipate client requirements, making it clear why they need something through empathy, understanding and a deep analysis of behaviour. We are not using AI to decipher what a client is trying to say in 2,000 different ways. For Max, every piece of data is an opportunity and FIs have vast amounts of data that can be leveraged to their benefit. The challenge is in accessing that data, as traditionally building those connectors has been costly and cumbersome and application programming interfaces (APIs) will take some time to become more prevalent. Max is designed to be adaptable and can be deployed rapidly in a variety of ways with little or no initial access to data – learning over time. Max also generates its own behavioural data with each interaction and while increasing customer knowledge on numerous levels, thus continuously enabling self-improvement. The funny thing is, the more you drive the conversation, the faster you can learn. The user is actually more accommodating because that is what we do as humans – we adapt to the situation. But if you do not drive the conversation theme, the level of personalisation you need becomes an issue very quickly. You cannot have the same level of personalisation when you are not driving

the conversation because you need so much more – that is a big challenge for chatbots today and can quickly lead to customer disappointment. There are some very interesting prototype neural networks to deal with this issue, however it will take the deployment of quantum computing to scale beyond being able to interact with more than just a handful of users simultaneously.

Making the right connections Given these realities, curating or semi-structuring each customer micro-journey or interaction has generated impressive results in terms of customer satisfaction and acceptance rates. It’s easy to see why if you think about it. We all know an advisor at the branch or call centre who really stands out. They might not be the most experienced or

We’re enabling banks to provide clients with their own AI-empowered virtual private banker and, in doing so, step out of the commoditisation conundrum

product savvy, but they consistently outperform their colleagues in terms of closure rates and customer satisfaction scores. And why is that? Because product knowledge, customer relationship management data and next best offer/product recommendations are not enough. Max knows that, too. We are aware that there are sometimes significant differences across the world in terms of how people view, interact with, and even converse about money, banking, and wealth building. That obviously needs to be considered; it’s about more than just language localisation. As humans, however, we all want to have personalised connections and experiences and be recognised and treated as individuals, wherever we are in the world. That universal truth is why I believe our solution resonates so well, whether in Asia, Europe or North America. In those regions where regulation is not focussed on protecting incumbents, I expect the market will continue to bifurcate. It will divide along the lines of those who continue to focus on a commodity approach and those looking to distinguish themselves by adding value and even changing the nature of financial services. We expect Exagens to play a major role in the latter. Issue 8 |


Engage Enrage Does your digital experience engage customers or enrage them? Consumer expectations continue to rise meaning the online customer experience is crucial. And it starts with the customer identification process. Does your onboarding experience make customers feel welcome or drive them away? And how do firms compare with their international rivals? Download our new study and find out why leaders in financial services are experts in customer identity.


Research carried out by:

Fintech Finance "Hong Kong to Singapore" Special Supplement  
Fintech Finance "Hong Kong to Singapore" Special Supplement  

Fintech Finance "Hong Kong to Singapore" Special Supplement