Kakao Bank has long proven skeptics of digital banks wrong. It has been profitable since 2019 and is now set to expand in Southeast Asia. There is just one problem: Its parent company’s founder Kim Beom-su was arrested on July 23. He has been accused of manipulating stocks during Kakao’s acquisition of the K-Pop agency SM Entertainment last year.

JPMorgan estimates that global corporates move nearly US$23.5 trillion across countries each year, equivalent to roughly 25% of global GDP. Since they rely on what the bank calls “sub-optimal wholesale cross-border payment processes,” annual transaction costs for the companies have reached US$120 billion. This is where atomic settlement comes in – and where the ambitious blockchain firm Partior – which was founded by JPMorgan, DBS and Temasek sees a large market opportunity.

We remember when Australia first kicked off its open banking initiative, known as the “consumer data right,” with much fanfare five years ago. The program was supposed to increase the quality of banking services to consumers by giving them access – in theory – to more of a customized experience in which they could pick and choose which services they wanted from which providers. They only had to agree to let their data be shared with different banks. However, a recent report by the Australia Banking Association (ABA) found that just 0.3% of bank customers are using the program, suggesting that it has been a failure and that Australia needs to reimagine its approach to open banking.

In one market after another in Asia Pacific, we are learning that the old maxim remains true: what goes up, must come down. Fintech funding was ascendant before the pandemic, briefly dipped during that crisis’s early months, and then surged to new highs. What finally crashed the party was an increase in the cost of capital (we can thank high interest rates and inflation for that) that has reduced the attractiveness of betting on loss-making – but potentially game-changing – fintech startups. Of all the markets in the APAC region, India has been among the most resilient because of its confluence of economic growth, financial digitization and unmatched scale. However, even India is not immune to challenging macroeconomic conditions.

When it comes to cross-border payment linkages, Southeast Asia is leading the way. Several years ago, Singapore and Thailand established the first such linkage with their respective real-time retail payment networks, making it possible for users to pay each other with just a mobile number. Since then, Indonesia, Malaysia and the Philippines have all established their own real-time payment systems. Of course, a broader regional system has always been the goal of central bankers, given the speed, efficiency and transparency it promises. With the advent of Project Nexus led by the Bank of International Settlements (BIS), that possibility may have just increased significantly.

The banking system in Singapore has been under greater scrutiny ever since a few banks operating in the city were ensnared in Malaysia’s massive 1MDB scandal. There is an inherent contradiction that all financial hubs face when they try to attract the ultra-wealthy and their assets, but also want to ensure the highest degree of compliance. Inevitably, some clients have something to hide. When there is possible unusual activity, banks have to make the call whether it is necessary to flag the transactions and report them. Thus it is not surprising that Singapore said in a new report that its banking sector poses the highest money laundering risks following a scandal involving more than S$3 billion (US$2.2 billion) in illicit assets.

Ant Group, under its Ant International arm, has been on a sustained international expansion campaign that increasingly encompasses Europe. While the company’s core cross-border payments business still targets Asia, it also sees opportunity further afield. On July 1, Ant announced that MultiSafePay, an Amsterdam-based payment service provider, had become its wholly-owned subsidiary and will integrate with the Chinese company’s Antom platform.

Ever since it realized that the inherent difficulties in making a profit from ride hailing, Grab has been working to build up its digital financial services offerings. While the super app value proposition looks increasingly shaky, the Singapore-based company has nonetheless developed a wide range of fintech products across Southeast Asia.

Some of these offerings have been more successful than others – and Grab has, as a public company, had to exit businesses that are unprofitable and do not show significant potential.

It is hard to believe that more than five years have passed since Hong Kong first approved virtual banks. The disruption that had been forecast has not come to pass and we wonder how much longer some of the online lenders will endure. Those backed by large public companies – which have to explain to investors why they are supporting unprofitable endeavors – could be the first to throw in the towel. That said, Hong Kong-based WeLab Bank, which is backed by billionaire Li Ka-shing, has seemingly defied the odds thus far with its performance. It says it is on a clear path to profitability and is expanding strategically in Southeast Asia.

Pine Labs is one of India’s most prominent fintechs and with its focus on B2B payments – and avoidance of the retail segment – eschews many of the problems that have dogged Paytm. Pine Labs serves over 500,000 merchants – including Sony, BMW and Samsung – to which it provides solutions for payments and other financial services. In 2022, it reportedly filed confidentially for an IPO with the U.S. Securities and Exchange Commission, but that plan never came to fruition given weak market sentiment. Now Pine Labs has resumed its IPO plans, but this time it is planning to list at home in India.