Asia must work harder to retain leading fintech – Asia Times

by James · November 17, 2022

Asia has led the way in fintech since it began to significantly reshape the way financial services are delivered to consumers, but it needs to work harder to maintain its dominance.

Most traditional financial services were monumentally surprised by the crash of 2007-2008. As they went into survival mode and regrouped, fintech providers began to move in, filling the void between what traditional financial services companies offer and what customers now expect, especially in terms of customer experience.

Fintech is already the new normal as we increasingly insist on immediate, on-the-go, 24/7 access, use and management of our money. We require personalized services on request and lower costs.

Asia continues to be at the heart of the fintech revolution.

We attribute this to several key factors. These include a proactive approach to innovation by regulators; the abundance of virtual banks; the evolution of the broader technology ecosystem, particularly application programming interfaces (APIs); and the influx of Chinese financial and technology giants into the sector.

The sector has incalculable benefits for Asian economies. It can increase wider innovation and competition across the economy, while managing risk.

It can also expand regulatory oversight to enable authorities to promote a safe, efficient and inclusive financial system, which will help strengthen the economy.

In addition, it can help proactively shape markets to encourage modernisation, competition and productivity within the financial sector.

In addition, it can help to bridge the gap between the public and private sectors, which will create a more flexible economy and contribute to strong cross-border coordination and sharing of information and best practice.

For these reasons, among others, such as societal ones, Asia needs to step up its game to stay ahead. This is because as the advantages of early movers and adoption diminish, slower markets, such as those in the West, will see the huge benefits of what has happened in Asia, build on developments and find dynamic ways to catch up.

To some extent it is already happening.

Without a strong economy and a strong financial sector, a country and/or a region has limited influence. As the future of finance is technology, fintech will determine the powerhouse economies of the next decade.

It is in Asia’s hands to remain dominant in fintech.