Displaying items by tag: online banking

On December 11th, 2017, China Union Pay (CUP), together with over 30 commercial banks and payment institutions, launched a new version of its mobile payment APP, QuickPass (云闪付), starting a new battle in the mobile payment industry.

NPAs (non-performing assets) as a percentage of total banking credit in the Indian banking industry has increased to nearly 5% in 2015. This has essentially come from the public sector (state owned) banks (PSBs). 90% of the NPAs in the Indian banking industry are attributable to these banks.

Published in India Banking Research

Want to unload that bad debt on your books? Now you can on Taobao. Cinda Asset Management, one of China’s Big 4 state-owned bad asset managers, has partnered with Taobao to sell RMB 4 billion-worth of creditor’s rights on the e-commerce company's asset disposal platform. This is seen as another potentially very successful cooperation between finance and internet industries as a large asset owner will have access to many new buyers through Taobao’s powerful channel.

Shanghai based Lufax, one of China’s biggest P2P platforms, has just received a USD 483 million-worth investment from foreign institutional and private investors. Is the investment rearranging deck-chairs on a sinking ship or a clear signal that everything is fine in the troubled P2P industry?

Published in China Banking Research

Last week, Alibaba’s finance arm rebranded their “Small and Medium Financial Services Company today to “Ant Financial Services Group” or “Ant Financial”.

Published in China Banking Research

Although Alibaba was in the first round of initial approvals to setup a private bank in China earlier this year, it was only at the end of September 2014 that they finally received approval to move forward on the project along with Juneyao, another large Chinese company who is also looking to setup their own bank.

Published in China Banking Research

China's online banking and mobile banking continue to be the key channels for customers who interact with their banks through 'e-channels' as data from iResearch, a Chinese online customer survey service provider, shows.

Published in China Banking Research

Earlier this year, we published our 2014 “Top-10 China Banking Industry Trends” report and predicted the advent of direct banks. We were right: in a month Minsheng Bank rolls out its Chinese direct banking institution.

Published in China Banking Research

On November 27, 2013, the Ali-cloud division of Alibaba group announced the launch of Ali Financial Cloud services.

Background

Ali financial cloud services has been developed to provide secure and stable IT resources and internet operation services for financial institutions including banks, funds, insurance companies and securities companies. The service is based on cloud computing, with the cooperation from many well-known financial product solution providers and Alipay’s standard connection portal and a completely sandboxed environment.

At current stage, China's approximately 2,000 small and medium banks are the focus of Ali Financial Cloud as these banks typically do not have enough capital and technology experience to develop their own robust IT structure, so outsourcing is thought to be a low cost and efficient way for these banks to process large amount of data and information.  

The claimed benefits Ali Financial Cloud include:

  1. Enable Small and medium banks to have their own online banking system and mobile banking systems and expand e-commerce and online banking services in the rural areas.  
  2. Provide stable and strong business processing capabilities for small and medium banks during high demand periods
  3. Enable small and medium banks with smaller technology footprints to develop innovative products and solutions that would typically only be available to larger banks
  4. Reduce IT support requirements

One example provided by Ali cloud website shows the processing capabilities of Ali cloud. About 300 million transactions of Yu’ebao could be cleared within 140 minutes, or about 35,000 transactions per second. Some financial firms are already using the Ali fianancial cloud including asset management companies, rural banks, regional banks and insurance companies.  

Historical Context

Cloud computing in China's financial services industry, similar to other global markets, has been slow to take off. Players like IBM have in the past setup comprehensive cloud computing research centers to attempt to move the market, but none have been incredibly successful in gaining a foothold. 

2014 might be the year when we see this change. Cloud technology and security has become increasingly sophisticated and with an increasing profit squeeze due to liberalising interest rates, banks will be looking for ways to increase revenue, reduce cost, and more importantly, stay innovative.

2014 - Year of the Cloud

Certainly Cloud will be a key industry topic as we move into 2014 with major players besides Alibaba including IBM, 21Vianet and Tencent all vying for a part of the increasing cloud computing pie.

It will also be interesting to see the level of innovation that happens in the space. Alibaba has rapidly moved beyond just an IT / e-commerce company to provide a variety of products and services beyond just technology. Its Yu-ebao product is forcing banks to re-think their retail investment products and how they price and distribute them – it has completely changed the industry.

With China's cloud services in the financial indusry being a key topic of discussion in 2014, could we see Alibaba do the same thing it has with 3rd Party Payment Platforms?

Over the past 3 years, online banking in Asia has been growing rapidly. A recent survey indicates that the usage of Internet banking has increased by 28% across Asia in the past five years, and the frequency of online banking usage actually surpassed branch banking in 2012, meaning that people in Asia access their account more online today than they do in person.

In China, there are over 650 million registered online banking customers in the 11 listed Chinese banks, and the combined online transaction volume represents over 60% of total transactions. Systems have matured to keep pace; not only do they provide scalability to deal with the increased transaction volume, but offer increased functionality for online banking in China customers.

In the densely populated areas like Singapore, Taiwan, and India, internet banking makes doing your banking less time consuming. Ten years ago, you may have had to wait hours in your bank to do simple transactions; today, customers can pay bills, transfer money, and even purchase investment products online rather than waiting in a crowded line.

China's Online Banking Customers

 

Source: Cebnet, 2013

Although internet banking usage in Asia is high overall, individual countries have varied levels of online banking development. Among all the Asian countries, online banking penetration is particularly low in Indonesia, the Philippines, and Vietnam, although there are signs of growth.

Online banking usage has started to grow rapidly in Indonesia since 2010, yet, of the 55 million Internet users, about 25% of the population, only 7% of these internet users actually do online banking, which indicates online banking is still relatively underdeveloped in Indonesia. Enhancements in the mobile online banking platforms including better security and ease of use, may help the industry attract more users and increase market penetration.

With the rapid modernization of companies, infrastructure and overall economies in Asia, Online banking in Asiawill continually show a steady growing trend in the next few years because it plays an important role by sharing the operational burden from branches, and provides more efficient service for customers. The current growing trend also predicts that online banking is slowly making branches less important, and its popularity will increase dramatically in the near future in Asia.

Published in China Banking Research