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FinTech (Pixabay/Dawnfu)
Compliance

Fintech is shaping and changing the financial services industry

19 January 2017
Read time: 2 mins
Also available in:
Of Counsel (AEoI, CRS, FATCA)

An interview with Liew Nam Soon, Managing Partner for Financial Services ASEAN, provides a deep-dive into the latest insights around the role of Fintechs.

Fintech is shaping and changing the financial services industry in a few ways:  

Firstly, Fintech is clearly providing institutions with new ways to get access to customers and improve their customer acquisition strategies. It also reaches out to what used to be the under-served, unbanked and even uninsured population. Examples are in China where firms like Alipay or Alibaba are offering even broader services not only for the consumers‘ financial needs, but also for their lifestyle purposes, which include purchasing of travel tickets or accommodations. I think this development is the biggest disruption happening right now – how customers are acquired and served, which goes to show that collaborating with Fintech offers many new possibilities for the financial industry.

Another area of disruption is around operational efficiency and how operating models have been disrupted. A good example is around blockchain and robotics or Robotics Process Automation (RPA). A lot of Fintech's operations will make processing a lot more efficient through automation. This raises the quality and reduces the need for manual intervention and the likelihood of human errors. Overall, this brings about time savings and a lowered cost to serve.

The third area of disruption is in respect to compliance, for example how regtech is helping with automating and embbeding analytics into the KYC or AML processes to address financial crime and look at areas like trade survellience. This helps the compliance units in institutions to identify risks and areas of non-compliance, which is crucial as well to protect the institutions from financial or reputational loss.

The capabilities around robotics and blockchain may be a lot more advance than we think. It also seems that some of the major financial institutions are in the process of implementing RPA in their back offices, in finance, operations, compliance, legal and taxes and RPA may also be an option to outsourcing.

Source: Finews Asia