CCAF Publishes ASEAN Fintech Benchmark Study: The Emergence of Fintech Start-ups in the ASEAN Region Has Progressed at an Unprecedented Pace

The Cambridge Centre for Alternative Finance (CCAF), at Cambridge Judge Business School, is out with the Asean Fintech Ecosystem Benchmarking Study published in partnership with the Asian Development Bank Institute (ADBI) and FinTechSpace in Taiwan.

CCAF is the leading research institute covering the global alternative finance. CCAF has published numerous reports covering the emerging Fintech ecosystems around the world including the most recent report on blockchain (DLT) utilization.

The Report surveyed data from 327 firms from the six main countries in the ASEAN region: Singapore, Indonesia, Malaysia, Thailand, Philippines, and Vietnam. CCAF reports that the emergence of Fintech start-ups in the ASEAN region has “progressed at an unprecedented pace.” During 2018, over $485 million was invested in 68 different deals – a 143% increase versus year prior and more than 4X in 2016.

CCAF states that there are more than 600 Fintech start-ups in the ASEAN region and new Fintechs are emerging almost daily as the financial services industry shifts from its analog past to its inevitable digital future.

the emergence of #Fintech start-ups in the ASEAN region has progressed at an unprecedented pace Click to Tweet

Financial Inclusion is Key

Even while innovation in financial services is taking place at a rapid velocity, more than half of the adult population in the ASEAN region remain unbanked. In fact, a majority of the population is living at, or below, the poverty level, CCAF explains. Fintech can be a catalyst to drive wealth and move the population of these various markets into the middle class.

The CCAF Report notes that digital payments and online lending are the two most dominant Fintech models in the ASEAN region accounting for almost 60% of all Fintech activity.

Within digital payments, peer-to-peer (P2P) transfers/mobile money and international remittances represent the largest sub-segments at over 65%. Peer to peer (P2P) lending to SMEs is the largest sub-segment for online lending with 53% of responses.

Robert Wardrop, Director of the Cambridge Centre for Alternative Finance, comments in the forward of the Report that in 2018 the ASEAN region experienced a 58% increase in internet penetration and a 141% jump in mobile connectivity. Obviously, the advent of smartphones is a huge catalyst for mass access to sophisticated Fintech services.

“This indicates a region primed to lead the push in developing Fintech solutions to revolutionize financial services and realize its potential to tackle critically important regional issues such as access to financial services and financial inclusion,” said Wardrop. “While Fintech solutions can be a key enabler for financial inclusion, the study shows that only 170% of customers served by Fintech firms in the region were categorized as unbanked and 28% were underbanked. More work is needed to help the unbanked, given that more than 50% of the adult population in most ASEAN countries are unbanked.”

The CCAF report states that Fintech firms place the highest priority on ease of customer use and speed of service as their main strategies across all business models. Additionally, as the Fintech ecosystem matures, firms are “increasingly shifting towards servicing small businesses and larger corporations, moving away from a consumer/individual focus.”

Dean Naoyuki Yoshino of the Asian Development Bank (ADB) commented that individuals, households and firms cannot fully take advantage of the opportunities for economic and social development available if they do not have adequate and appropriate access to financial products and services.

“Developments of financial technology show great potential to extend the availability of financial products and services to households and small and medium-sized firms in Asia.”

A good portion of the report focuses on the important role that regulation plays in the advancement of Fintech and financial inclusion.

the important role that regulation plays in the advancement of #Fintech and financial inclusion Click to Tweet

CCAF includes a regional comparative analysis of the current state of regulations and legislation as well as a regional overview of regulatory innovation initiatives. The Report provides a country-by-country review for each of the 10 ASEAN member states, detailing the regulations governing prominent Fintech sectors.

The study found that each country is interested in emerging technologies within financial services. Bespoke regulation exists in all of the countries covered. As an example, 80% of the ASEAN countries have introduced specific rules for the regulation of digital payments.

ASEAN regulators are also widely leveraging regulatory sandboxes (60%), Regtech (50%) and opening up innovation offices (50%).

The majority of regulators have signed co-operation agreements to share information on Fintech sectors in their respective markets.

Regulatory harmonization is very important to remove jurisdictional friction and efforts are “underway to encourage and further facilitate this, specifically involving cross-border initiatives.” Over-regulation can hamper growth, of course.

Report partner FinTechSpace issued the following statement:

“For regulators and policymakers in greater ASEAN, (the report) could be a great reference for their Fintech international strategy plans. For private sectors, both financial institutions and Fintech companies like to explore and enter these markets; thus, our report could be a great start for market research. The new study, focusing on the ASEAN FinTech ecosystem, complements earlier CCAF studies on the growth of alternative finance in the wider Asia–Pacific Region.”

Wardrop noted that this report has been one of CCAF’s most challenging research projects. But while a challenging survey to complete, Wardrop believes it provides a “valuable overview of Fintech in the region and will inform the work of others seeking to realise the potential that Fintech innovation offers.”

As with all other CCAF research reports on alternative finance/Fintech, this is a must-read document for industry participants as well as interested policymakers.


Lead Authors include:

Miguel Soriano (Fintech Market)
Dr. Miguel Soriano is a Research Affiliate at the Cambridge Centre for Alternative Finance where he leads research on FinTech for financial inclusion in emerging markets. Miguel is also a Digital Finance Senior Specialist at the World Bank and IFC, advising on numerous technical programs related to digital banking, FinTech and off-grid solar in Africa, Asia and Latin America.

Tania Ziegler (Fintech Market)
Tania is the Head of Global Benchmarking at the Cambridge Centre for Alternative Finance, leading research on capital raising alternative finance in five regions. Her research interests include small business economics and SME utilization of alternative funding models to access finance. She is a 2009 Fulbright Scholar and has an MsC from the London School of Economics.

Zain Umer (Regulatory Landscape)
Zain is a Research Affiliate at the Cambridge Centre of Alternative Finance. His research interests and expertise include regulatory innovation and FinTech as a means to facilitate financial inclusion, especially in emerging and developing economies

Hungyi Chen (Regulatory Landscape)

Dr. Hungyi Chen is Asia-Pacific Region Manager for the Cambridge Centre for Alternative Finance. Hungyi has led and co-authored many of the most influential industry reports on the alternative finance industry in APAC since 2015.


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