Asia’s internet firms are challenging the region’s traditional banks for consumer finances, tapping their massive user networks for business and following a trail blazed in China by tech giants Alibaba and Tencent, Reuters reports.
The push into banking by companies better known for their messaging apps, cute emojis and online holiday bookings comes as regulators across Asia open up their banking sectors to a new breed of digital players.
The shift is in its infancy but contrasts sharply with the banking markets of Europe and North America, where change is slower and such startups tend to be backed by venture capital funds and financial sector incumbents, not tech firms.
Asia’s tech entrants see their advantage in the way they can seamlessly integrate banking services with their users’ regular online activities and the efficiency that comes from their technology.
“If you want to open a bank account (in Hong Kong) you need to go to a branch, answer questions for an hour, and you still won’t get the account opened without follow up calls,” said Wayne Xu, president of ZhongAn International, a unit of Chinese online insurer ZhongAn, setting up a virtual bank.