Financial Services

Whose customer are you? The reality of digital banking in Asia-Pacific

July 18, 2018


July 18, 2018

Renée Friedman


Renée Friedman joined The Economist Group in July 2016 as a Managing editor for EMEA.  Her work focuses on thought leadership programmes for the financial services sector.

Prior to joining The Economist Group, Renée worked in a variety of roles: in Economic and Political risk consulting, in finance in the City of London as an Economist, a Macro strategist and a Bond fund manager,  in the  international and UK domestic policy spheres as an Economist to the Treasury Select Committee at the House of Commons and as Senior Economist and Chief Technical Advisor for the UN Development Programme’s (UNDP) Regional Bureau for Europe and the CIS,  and as an academic, designing and teaching economics courses at universities across London.

Renée has spoken on a variety of panels  and events focused on Russia, Ukraine and other emerging market economies including those for BNE Intellinews, IHS Global Insight, the IMF Poverty Reduction Strategy meetings, and for the UNDP. She has also appeared on CNBC.

Renée holds a PhD in Economics from London Business School, a Masters in Russian and East European Studies from the University of Birmingham, and a Bachelors in International Trade and Development from the London School of Economics & Political Science.  She is also a Prince 2 certified project manager. In addition to her native English, Renée speaks Russian.


Who needs Silicon Valley?

China leads Asia’s diverse digital banking markets

If you want to see what universal digital banking looks like, skip Silicon Valley or London’s fintech hubs. China’s Alipay and WeChat Pay show how to do smart, mobile-based banking on a massive scale. Regulators are now adapting to new customer demands.

The Asia-Pacific retail banking market is diverse, reflecting the different levels of social, economic and financial institutional development. It ranges from the near universal coverage found in the more developed markets of Australia, New Zealand, Singapore and Hong Kong to the emerging market of Cambodia, where only 21% of people over the age of 15 have a bank account. It also includes India, where government policies have pushed inclusion by shifting state transfers, pensions and benefits directly into accounts or onto biometric smartcards. Accordingly, Indian account ownership has jumped from 35% in 2011 to 80% today.

However, bankers in The Economist Intelligence Unit’s survey see common themes. Within the Asia-Pacific region, changing customer demand will have the biggest impact on retail banking in the next three years.

Regulatory trends are less of a concern in Asia-Pacific (40%), compared to Europe (46%) and North America (56%). Bankers in Hong Kong and Singapore seem to benefit from the more tech-friendly “try it and see” approach of their own regulators. Both the Hong Kong Monetary Authority (HKMA) and the Monetary Authority of Singapore (MAS) have opted to create “regulatory sandboxes” to encourage innovation. These sandboxes allow banks and fintechs to trial their ideas while involving only a limited number of participating customers. However, the situation is very different in Australia, where bankers have come under fire from the regulator due to poor risk management, high fees and widespread mis-selling.

An April 2018 report by the Australian Prudential Regulation Authority into the Commonwealth Bank of Australia (CBA) made clear that “a widespread sense of complacency has run through CBA, from the top down”. The subsequent loss of 20m customer account details only compounded the likelihood of significant reputational damage.

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