FSIReview: Issue 11

Rapidly advancing technologies, evolving customer expectations and a changing regulatory landscape are opening doors to disruptive innovation in financial services. From crypto-currencies to big data to peer-to-peer lending, financial technologies (FinTechs) innovations have captured the attention and imagination of customers, investors and incumbents.

Disruptive innovation is here to stay, creating clear threats to the traditional structure of the financial world, but also opportunities for positive change and growth. The challenge: the financial services industry is struggling to understand which innovations will be the most relevant, as well as figuring out the evolutionary path of emerging innovations and the specific implications of those evolutions on existing institutions.

In this issue, we reflect on and emphasise the current digital disruption the industry is facing. We begin with highlights from our recent study with the World Economic Forum where we spent a year working as a project advisor examining the impact of innovation on multiple aspects of financial services.

Next, we examine the financing, banking and payment issues small and medium-sized enterprises (SMEs) in Southeast Asia face and how incumbent/challenger banks, FinTechs and e-commerce providers are seeking to fill the SME financing gap by adopting innovative business solutions.
Regulation continues to be a hot topic in the industry and has emerged as a major strategic consideration for financial services firms. While many reforms have been completed, our review of the current regulatory agenda indicates that it will remain full in coming years. We summarise the key elements of the current international reform agenda and highlight the application of these in the Asia Pacific region, organised around the major work-streams of the Financial Stability Board (FSB).
We also outline the challenges faced by private banks in Asia as they are increasingly burdened by risk and regulatory requirements and provide tips to effectively deliver private banking risk and regulatory transformation.

We round things off with our Asia Pacific Economic Outlook for the last quarter, which provides a near-term outlook for Malaysia, the Philippines, Taiwan and Thailand.

To receive a copy of the report, please drop us an email at sgindustries@deloitte.com.