- Asia-Pacific (APAC) leads the world in the rapid adoption of digital due to customer demand and unbanked potential
- Regulatory trends are less of a concern to respondents in APAC at 40%, compared to Europe (46%) and North America (56%)
- New payment players are driving the shift to digital services in APAC
- The platformization led by Alipay and WeChat is likely to spread quickly across markets
- 81% of bankers surveyed believe that users will expect a single entry point to all their financial needs in the coming years
GENEVA, Switzerland – July 17, 2018 – Bankers and regulators across the Asia-Pacific region are witnessing a paradigm shift in the industry as digital banking becomes embedded.
The rapid digitization and platformization in countries like China demonstrate the huge potential that exists in this diverse and growing market, according to an article released by Temenos, the banking software company and written by the Economist Intelligence Unit (EIU),
According to the EIU, new payment players across the region are driving the shift to digital. 55% of bankers surveyed in APAC think that changing customer demands and behavior will have the biggest impact on retail banks in the next three years. In China, Alipay and WeChat now dominate smartphone payments. Bankers have taken notice, and 48% of survey respondents said that payments players will be their biggest competition over the next three years. The overwhelming majority (81%) of bankers surveyed also believe that users will expect a single entry point to all their financial needs.
Regulators in many countries across the region are responding with a tech-friendly approach; only 40% of bankers across the region responded that new regulations were a concern, compared with 46% in Europe and 56% in North America. Improving product agility was a top strategic priority for 57%.
The article also highlights the diversity of the Asia-Pacific retail banking market, reflecting the different levels of social, economic and financial institutional development. An example of this is retail banks’ consumer reach which ranges from near universal coverage in the more developed economies of Hong Kong and Australia, to only 21% of people over the age of 15 having a bank account in Cambodia. The research also indicates how rapidly this situation can change, as in India, where de-monetization initiatives led to a jump in mobile payment users from 35% in 2011 to 80% today.
Martin Frick, Managing Director, Asia Pacific, Temenos commented:
“Asia-Pacific is leading the world in the rapid adoption of digital banking due to consumers’ constantly evolving demands, combined with the unbanked potential and benign regulation. Non-traditional challengers are also shaking up the market. When a consumer’s chat app already offers a single point of entry for all their financial needs, banks need to innovate fast and at scale if they want to remain relevant.”
Temenos Press Contacts
Jessica Wolfe & Grace Collins
Temenos Global Public Relations
Alistair Kellie & Andrew Adie
Newgate Communications for Temenos