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In an interim report released last month Australia's Banking Royal Commission has highlighted the misconduct, greed, and even criminality involved in the Australian financial services industry. Set up in December 2017, the commission has worked through over 700,000 documents to investigate the dealings of some of Australia’s largest financial companies. The commission has heard from victims and cross-examined some of the key figures in the industry. The results are damning and are likely to spark much greater support for tougher regulation on the banks in the future. However, a battered, bruised, and riskless financial system is no good to anyone and may end up causing further disruption to the economy. It’s important that the government finds the right balance.
China's bank card market is large. Over 9 billion domestic payment cards will be in use by the end of 2018, a nearly 35% increase from the 6.7 billion in 2016. Even though the market is replete with card providers, the clearing business has been always dominated by the only one licensed clearing institution, China UnionPay (CUP), for both domestic and cross-border RMB transactions. That is, until now.
In China, financial cloud has become a key goal for financial institutions in 2016. According to ‘the 13th Five-year Plan’, by the end of 2020, banks’ online business system should all be transferred to cloud and more than 60% of their other business systems should be moved online. With this clear direction, banks are taking actions. The China Academy of Information and Communications Technology (CAICT) found that in 2017, 42% of financial institutions are applying to use cloud, whilst 47% are in the process of planning the transition to cloud as companies seek to establish agile banking infrastructure.
On September 18th 2018 the MAS launched the Singapore Quick Response Code (SGQR). Within the next year, 27 different mobile wallet providers including PayNow, NETS, GrabPay, Liquid Pay, and Singtel Dash will incorporate the new standardised code. The SGQR is the first of its kind globally and represents a significant change to the e-payment landscape. Interoperability is seen as a key infrastructural requirement for mobile payments and will have several impacts on new and incumbent firms in the market.
At the end of last month, another Chinese fintech company Samoyed Holding filed for $80 million IPO on the New York Stock Exchange. The company provides consumer finance services for the Chinese millennials. Its main business is the credit card balance transfer business, counting for 74.7% of its 2017 turnover.
Financial results from China's banks are improving recently as tight regulation is limiting the expansion of 3rd party competition, while overall bank profitability is increasing.