How data personalization is driving the future of Asia's digital finance

Written by || January 07 2022

Across Asia, new ground is being covered daily in product personalization by fintech disruptors. Superapps like China's Alipay and India's Paytm are delivering hyper-personalised offerings that can specifically target their customers’ ever-changing needs. Digital finance players are using data to meet unique customer challenges and create seamless, omnichannel experiences, taking a lesson from E-commerce platforms that have introduced live streaming of unique products and continued to put a heavy emphasis on personal discovery and curation. However you look at it, consumer data is on a new playing field.

Within the region, some countries are better positioned to benefit from advances in data personalization than others. Vietnam is a prime example. According to a joint Facebook and Bain and Co report, Vietnam will be the fastest growing market in digital financial transformation. Some seven out of ten consumers already have access to digital finance, and there has been an increase in the use of e-wallets, payments via smartphones and QR codes, and high demand for ‘instant credit’ solutions such as buy-now-pay-later, catering to Vietnam’s unbanked or underbanked.

The shift to make digital finance solutions more inclusive will permeate businesses. Digital finance players, wielding their analytical powers, need to create more innovative channels for communication with consumers and deliver digital experiences that complement each unique Asian market.

A model to follow may be found in United Arab Emirates startup BankBuddy, who is leading the way in cognitive banking by embedding functionalities such as voice IVR, multilingual bots, natural language processing, machine vision and AI-powered recommendations. Another innovative player in the space is Indonesia’s Finantier, accelerating financial inclusion by pulling together comprehensive consumer insights from data amassed from Indonesian gig economy platforms and telcos. Indonesia’s vast and diverse unbanked population, from roadside warungs to gig economy workers, are part of a massive audience that stands to benefit from digital finance penetration.

All seeking to capitalize on changing trends, capabilities, and consumer demands, a battle between banks and digital finance start-ups is underway in Southeast Asia’s financial industry. Both traditional incumbents and the more nimble new kids on the block are showing they are capable of building an app-only digital banking infrastructure. Singapore’s Sea and Grab, for instance, both intend to roll out digital banking services this year.

Meanwhile, both banks and payment providers need to roll out data-driven payment solutions for a newly emerging creator economy. Covering often under-recognised creatives, this group encompasses everything from TikTok influencers for muay thai in Thailand, manga illustrators in Japan, to sari and henna makers in India. What may seem like a niche will actually be a critical segment to cover, as Gartner estimates that 60% of Millennial and Gen Z consumers will prefer making purchases on social platforms over traditional digital payment platforms by 2026.

In Asia, the ability to deliver payment options that resonate with each market has captured huge audiences. Through data personalisation, payment providers can leapfrog in growing their market share and enable quicker digital financial services adoption. Innovative players in the cross-border payments space need to continue to leverage first-party data to transform the way they engage with consumers and provide personalised, cross-channel experiences for each market they serve.