Asia Payments Research

How long has Revolut been saying it has big plans for Asia Pacific? At least six years, if not longer – by our calculations. It has a presence in Australia, New Zealand, Japan, Singapore and India and at one time planned to set up shop in many other Asian countries. Yet this ethos originated in a time of low interest rates and near infinite VC funding. Revolut did not have to worry too much about profitability back then, so it could devote most of its attention to growth. At the same time, the multicurrency wallet that lies at the core of Revolut’s value proposition may not be that attractive to customers in emerging markets more focused on gaining access to core retail banking services.

Despite the best lobbying efforts of certain industry players, Australia is moving forward with long-running plans to rein in the buy now, pay later (BNPL) segment of digital financial services. Provided that the bill introduced on June 5 becomes law, BNPL firms in the country will be required to run credit checks on borrowers and hold an Australian Credit License (ACL).

Although the narrative in the financial industry is that digital is better, that is not always the case. Many rural economies across Asia operate on a largely informal and cash basis. A few factors are driving this. Firstly, there is often a lack of infrastructure to support cashless payments, such as limited internet access or banking services. Secondly, the rural populations often have a general distrust or lack of familiarity with digital payment systems. Additionally, the informal nature of many businesses in rural areas lends itself to cash transactions, which are perceived as more straightforward.

While the buy now, pay later (BNPL) concept has proven immensely popular with consumers worldwide, developing a sustainable business model as a BNPL focused fintech is a challenging endeavor. For that reason, it is always noteworthy when a BNPL firm reaches the profitability milestone. The Philippines’ Billease, founded in 2017, appears to have done so in 2023.

Vietnam is one of the most promising markets for fintech in Southeast Asia, with the payments segment continuing to lead the way. While talk of Vietnam going truly cashless is premature, there is a steady transition to digital payments in the country. Data compiled by the State Bank of Vietnam show that non-cash payment transactions increased by 63.3% in volume and 41.45% in value in January, compared to the same period in 2023. Many Vietnamese banks now have over 90% of their transactions conducted via digital channels.

Singapore-based payments fintech Nium has been busy expanding internationally as it seeks to put itself in the most favorable position possible ahead of a planned IPO in 2025. In recent months, Nium has expanded on multiple continents, from South America to different parts of Asia.

It has been a rollercoaster seven weeks for India’s preeminent fintech Paytm, which on January 31 was accused by the Reserve Bank of India (RBI) of “persistent noncompliance.” To be precise, it was Paytm Payments Bank that the RBI named, and it is the payments unit of the company that ceased to exist as of March 15. The good news for Paytm is that the RBI’s crackdown on its payment bank is not a lethal blow – and was never intended as such.

With funding for fintech startups having fallen precipitously from the days of ultra-low interest rates and a focus on growth at all costs, a reality is setting in: Disrupting the giants of incumbent financial services is no easy task. In many cases, it has proven elusive.

Singapore-based payments firm FOMO Pay has been expanding internationally on several continents. The company, which is a partner of Ripple, recently received a Money Service Operator license for Hong Kong and last week announced its expansion into Africa. It also recently secured a partnership with Mastercard and Z Bank.

Singapore-based multicurrency wallet YouTrip announced on January 3 that its users can now hold up to S$20,000 (US$15,025) in their e-wallets and have an annual spending limit of S$100,000, up from S$5,000 and S$30,000, respectively. The new maximum limits are the same as those recently adjusted upward by the Monetary Authority of Singapore (MAS).

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