Welcome to the latest edition of Protiviti’s Asia-Pacific (APAC) Financial Services Insights. In this monthly newsletter, we provide a summary of important developments across the APAC financial services sector, including those related to the ever-changing regulatory landscape.
In recent weeks, news across the APAC financial services industry has been dominated by the increased demand for digital banking and virtual insurance services as a result of changing consumer behavior during the COVID pandemic. In Hong Kong, Manulife customers can now meet agents virtually; in Australia, fast-paced embracing of technology has resulted in a digital banking revolution; and Japan explores a possible future ‘digital yen’. At the same time in Singapore, banking authorities are targeting unlicensed crypto sellers under the new Payment Services Act as well as looking to tighten anti-laundering rules for casinos.
Recent years have seen an accelerated growth in Asia’s digital banking sector. More fintechs and newly licensed virtual banks are coming to market to address the unbanked segment, while traditional banks are transforming to manage costs and achieve operational efficiency in this increasingly competitive landscape. Along with digitization comes increased risks related to identity theft, account takeovers and data breaches.
(FinTech Singapore, 02/06/2020)
Alternative lending companies and platforms in the region are laying off staff and trying hard to raise funds and prevent bankruptcy as they face a wave of bad loans.
According to Fitch Ratings, Asia-Pacific emerging market banks whose ratings benefit from sovereign support could be affected if the economic impact of the coronavirus deepens and governments' policy responses fail to adequately mitigate risks to the economy.
(Fitch Ratings, 17/06/2020)
The Central Bank of Singapore announced its plans for assessing COVID-19 impact on applicants for digital bank. The applicants must now factor in how the COVID-19 outbreak has impacted their funding and profitability plans.
The Casino Regulatory Authority has already asked casino operators to lower the threshold for cash transactions that are subject to due diligence to half the current legislated level.
A 23-year-old woman charged with providing payment services without a license is the first person to be charged under a new law that fights money laundering and terrorism financing. The Payment Services Act, which also aims to strengthen consumer protection in the use of e-payments, was introduced on 28 January of this year.
(Straits Times, 25/06/2020)
Some global companies are considering shifting some of their treasury operations out of Hong Kong as the United States moves to end the city’s privileges. Against the backdrop of a new national security law, a handful of global firms are eyeing countries like Singapore, Malaysia, Thailand and Vietnam.
Launched on 15 June, the platform enables customers (new and loyal) to meet virtually with Manulife’s agents via a secure video conference and purchase individual insurance products.
The government will subsidise the salary of one full-time new hire with HK$10,000 every month for a year as part of the FinTech Anti-epidemic Scheme for Talent Development - the latest in a series of plans launched by the Hong Kong government to prevent more job losses.
For banks facing the biggest economic shock since the 1930s Great Depression, this rapid acceleration in customers' embrace of technology is something of a double-edged sword. COVID 19 has fundamentally changes the ways some Australians deal with money.
(Sydney Morning Herald, 08/06/2020)
Some credit cards companies have even increased rates in recent years, undermining the Reserve Bank's efforts to relieve pressure on households. Since 2011, the Reserve Bank has cut the official cash rate from 4.75 per cent to 0.25 per cent, but some credit card customers have received the opposite treatment.
The Consumer Data Right Act became law on July 1, introducing the open banking regime nationwide. The regime will be rolled out in stages; at this time, consumers can share their bank data with accredited third-party providers for deposit and transaction accounts as well as credit and debit cards and beginning in November this will be extended to a broader data range.
(Business Insider, 06/07/2020)
China’s central bank will start buying bank loans made by local lenders to small firms and try to increase lending by banks as much as 1 trillion yuan to small businesses amid the coronavirus pandemic.
China's central bank pledges to keep financial liquidity at a reasonable and adequate level in the second half of 2020, to tackle the impact of COVID-19 on the economy.
Three Japanese megabanks and cashless payment providers plan to set up a consortium to streamline and interoperate their services, which could evolve into the introduction of the 'digital yen'. While a number of cashless payment services are available in Japan, participant bank are expected to study measures to boost their services to make them more convenient for customers.
(Japan Times, 03/06/2020)
Japanese bank lending rose at the fastest annual pace on record in May 2020 as cash deficit companies tapped loans to meet immediate funding needs and survive slumping sales from the coronavirus pandemic.