Latest Reports

Events

No events
Latest Insight

It is hard to believe that during the first half of 2021 Chinese IPOs in the United States raised a record US$12.4 billion, per Dealogic’s estimates. That was the boom before the bust, which had been brewing for a long time but came to the fore with the disastrous debut of Didi Chuxing on the NYSE. Like Alibaba’s nixed IPO heralded a widespread regulatory crackdown on fintech, Didi’s is doing the same for Chinese IPOs overseas.

Ant Group-backed Mynt has grown expeditiously thanks to the success of its e-wallet GCash in the Philippines. In January, Mynt closed a funding round that raised US$175 million and brought the company close to unicorn status. In late July, Mynt’s chief commercial officer Frederic Levy told Nikkei Asia that the company was aiming to become a “double unicorn” – with a valuation of US$2 billion. But it is unclear if Mynt can maintain the same level of growth now that the Philippines has five genuine digital banks.

 

Never short of ambition, Revolut is aiming for an Australia banking license roughly a year after formally launching its app Down Under. The UK neobank unicorn is in discussions with the Australia Prudential Regulation Authority (APRA) as it seeks approval to take customer deposits and provide lending services.

With the Australian buy now, pay later (BNPL) segment increasingly crowded, some of the biggest players are searching for greener pastures overseas. While Afterpay has been the most aggressive in terms of global expansion, its rival Zip (Australia’s No. 2 pure-play BNPL firm) is catching up. Having already expanded to New Zealand, the U.S., Canada, Mexico and the UK, Zip is now foraying into Africa with the acquisition of South African payments startup Payflex.

Digital banks are fast becoming a fixture of the Asia-Pacific fintech boom, in many ways a manifestation of Big Tech’s desire to become Big Fintech. In contrast to the United States and Europe, where ascendant digital lenders are usually pure-play operations that began as humble startups, APAC has an increasing number of so-called digibank startups backed by the region’s largest tech companies and some major incumbent financial services firms.

Sea Group just can’t lose when it comes to investor sentiment, even though the company’s losses widened on an annual basis to US$433.7 million in the second quarter from US$393.5 million a year earlier. The day before it reported Q2 earnings, Sea’s share price was about US$291 and as of August 23 it had reached US$315. Over the past year, the stock has risen more than 105% while Sea’s market cap now stands at US$168 billion.

The Philippines has returned to an unenviable position: It is once again one of the only East Asian countries on the Financial Action Task Force’s (FATF) Grey list, alongside Cambodia. Countries on the grey list have been flagged by FATF for insufficient anti-money laundering and/or counterterrorism financing controls. Being on the list creates regulatory headaches for financial institutions – such as higher interest rates and processing fees – and can be detrimental to a country’s business environment.

With 37 retail banks for a population of 23.5 million, Taiwan is not the easiest market for digital banks to crack. Just about every Taiwanese adult has a bank account; in fact, many have more than one because of the tendency of companies in Taiwan to require employees to open a bank account with the company bank. Nevertheless, near ubiquitous smartphone penetration and the popularity of certain platform companies’ ecosystems offer digital banks an opening in Taiwan, especially given the effect of the pandemic on people’s banking habits.

The super app trio of Grab, GoTo and Sea is growing increasingly dominant in Southeast Asia, but not yet in Vietnam. In fact, it is the homegrown MoMo which leads Vietnam’s e-payments market. MoMo says it has a 60% market share and processes US$14 million annually for 25 million users.

We have to hand it to AirAsia: They tell the super app story well, probably better than some of the others whose task is less daunting than the beleaguered airline’s. Indeed, AirAsia is not a high-flying tech company aiming to use fintech to take its valuation and exit to the next level, but an airline facing an existential crisis wrought by the never-ending coronavirus pandemic. If AirAsia pulls off its transformation, it will stand as one of the great turnarounds in recent Asian corporate history, and perhaps pave the way for a new breed of platform company.

Page 5 of 68