Why Singapore is a natural hub for fintech innovation

Why Singapore is a natural hub for fintech innovation

Jon Allaway
16/11/16, 05:00 pm

SINGAPORE (Nov 16): This week Singapore expects to host roughly 11,000 participants from more than 50 countries at the inaugural FinTech Festival.

The Monetary Authority of Singapore forecasts the weeklong event to be the world's largest fintech event so far, clearly establishing Singapore as a leader in fostering innovation.

This makes sense – as Asia is at the forefront of fintech at the moment. In the first three quarters of 2016, fintech investments in Asia Pacific reached nearly US$10.5 billion ($14.9 billion), the bulk of it driven by investments involving Greater China companies. This is more than Europe, which attracted US$2 billion in investments, and more than the US, which attracted US$6 billion in investments in the same period.


At Accenture we are seeing interest in fintech from Tokyo to Sydney. Indeed, a select group of leading-edge fintech companies demonstrated their products and services to more than 250 bankers, venture capitalist and technology executives at the third annual FinTech Innovation Lab Asia-Pacific Investor Day in Hong Kong last week.

Why Asia, you may ask?  Quite simply, there is a need for innovation and a willingness to provide it. Think about the far-flung villages in the archipelago of Indonesia, or the vast countryside of both China and India. Building brick and mortar banks, and staffing them, is not a realistic solution. Providing mobile and digital alternative is viable. Regional banks, many based in Singapore, as well as the leading banks in each country, would like to own those solutions and woo those customers who are in need of more financial services. So they need to innovate.

Singapore, Hong Kong, Tokyo and Sydney – major financial services hubs to start with – are the natural incubators for solutions. While some like to posit the burst of fintech activity in each city, as a competitive landscape where only one city can come out on top, what we are seeing is a positive competition. Each city is pushing the other to keep apace, and the result is a vibrant fintech environment where useful solutions are incubating.

Consider the range of fintech startups with Asia-Pacific roots. AMP Credit Technologies is a fintech startup with offices in Singapore that enables banks and other financial institutions to profitably offer short-term unsecured loans to under-served small businesses in both developed and emerging markets. Singapore’s HedgeSPA — is a predictive investment analytics platform that enables investment professionals to tap the internet to improve their performance. Both of these companies have either attracted investors or received research and development grants.

Then there are the fintech companies with major backers such as Alibaba and JD.com, which are primarily focussed on payments and lending. Ant Financial Services Group, the financial-services affiliate of e-commerce giant Alibaba Group Holding that operates China’s online-payments platform Alipay, closed a US$4.5 billion fundraising round in April.  Ping An-backed Lufax, which has started using the name Lu.com, completed a US$1.2 billion round of fundraising in January.  In that same month, China’s second largest e-commerce company, JD.com, raised US$1 billion in new funding for its consumer finance subsidiary, JD Finance.

In recent years, major Alibaba affiliates and China’s biggest social network company, Tencent, have also invested in other smaller startups, such as Fenqile, a micro-loan site which literally means “happy instalments,” Qufenqi, an electronics retailer that lets buyers pay in monthly instalments, and India’s One97 Communications, a mobile internet company whose Paytm is its flagship brand.

Singapore’s leadership role in fostering more innovation builds on this already robust base. It is a win-win-win. Win for the startups who gain access to advice and fundraising, win for Singapore, as it lures new businesses, and win for customers who will be the recipients of smarter, faster, less expensive services.

The next step is for the major fintech hubs in the region to collaborate to form a global/pan-APAC eco-system.

Jon Allaway leads Accenture’s financial services practice in Asean. He is a senior managing director based in Singapore.


Sentifi - The Edge Markets Singapore - Top themes and market

Pullman Hotel Munich

CDL Hospitality Trusts acquires Munich hotel for $154 mil; launches $255 mil rights issue

SINGAPORE (June 27): CDL Hospitality Trusts (CDLHT) announced Tuesday that it has entered into an agreement to acquire a 94.5% stake in the Pullman Hotel Munich in Germany for €98.9 million ($153.8 million). The 4-star Pullman Hotel Munich sits on two freehold land plots, and is located adjacent to the commercial district of “Parkstadt Schwabing”. The business park is home to industry heavyweights like Accenture, Amazon, MAN Financial Services, and Microsoft. The property is also near Munich’s popular tourist destinations including the English Garden, the BMW headquarters, and....

NetLink NBN Trust lodges prelim prospectus with MAS for $2.7 bil IPO

SINGAPORE (June 27): Singtel announced that NetLink NBN Management, the trustee-manager of NetLink NBN Trust, has lodged a preliminary prospectus with the Monetary Authority of Singapore in connection with the initial public offering and listing of NetLink NBN Trust on the Singapore Exchange. NetLink is offering 2.9 billion units in an indicative range of 80 cents to 93 cents each, putting the total deal at up to $2.7 billion, reported IFR, a Thomson Reuters publication, citing a term sheet of the transaction. Singtel, Southeast Asia's largest telco, tapped DBS Group, Morgan Stanley and ....

Ascott surpasses 100th property milestone with 7 new properties in China

SINGAPORE (June 27): The Ascott Limited, CapitaLand’s wholly-owned residence business unit, has secured seven new contracts to manage over 1,300 apartments across six cities in China. These properties mark Ascott’s first step into managing properties in Kunming and Yichang, while expanding its presence in Chongqing, Dalian, Shenzhen and Xuzhou. This year, Ascott has added to its portfolio more than 2,700 units across 15 properties in China, a 56% increase compared to about 1,700 units and 10 properties secured in 1H16. Lee Chee Koon, CEO of Ascott, said: “China remains Ascott’....