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Southeast Asia’s fintech revolution

A woman walks past a signboard for PayNow, a mobile fund transfer app, at the FinTech Festival in Singapore in 2017 Photo: Wallace Woon / EPA-EFE

Southeast Asia’s fintech market is among the fastest-growing in the world, with estimates placing expected market growth to reach between $70 billion and $100 billion by 2020. Fintech investments in Southeast Asia shot up by more than 30% over the course of 2018 to reach nearly $6 billion, while some estimates state that the overall Internet economy across the region increased by 44% last year compared to 2017.

Investors are channeling funding into the region, and for two-thirds of them, the primary target for mass investment is up-and-coming financial technologies. As these local fintech platforms rake in the money, they are setting their aspirations high for rapid growth: according to a census conducted last year by EY Asean Markets, 87% of the region’s fintech firms plan to expand beyond their current markets within 12 months, and 77% intend to eventually compete internationally – with many setting their sights on the US, UK and Chinese markets.

Southeast Asia is particularly primed for the rise of payment technologies, as three-quarters of the adult population remains unbanked. It also helps that Asean customers rank among the most willing to use fintech products, with 82% open to the idea in comparison to 77% in North America and 76% in Europe.

A recent report, released by international finance company Robocash Group, ranked the region’s top five countries in terms of fintech, with an eye on several nations where traditionally cash-based economies are embracing online payment platforms.


It comes as no surprise that Singapore should be at the forefront of the digital payment market, as it has long been a leader in smart cities, hyperconnectivity, and all things tech. In 2017 alone, the country raised upwards of $229 million in funding for its local fintech firms – of which it has over 400.  

The country has dominated the region’s fintech market for several years now, as it laid claim to more than 50% of all fintech deals made in Southeast Asia between 2013 and 2016. With a more advanced fintech space, the market has rapidly diversified, including peer-to-peer payments, fund transfers, money lending services, investment apps, insurance services, cryptocurrency trading and crowdfunding platforms.


Indonesia has the largest population of all countries in the region, and is therefore home to a massive consumer base. Even though just over half of its population are active internet users, this still reflects 150 million people who are online and ready to enter the fintech space. Of Indonesia’s internet users, 61% are registered for mobile banking apps. With only 11% of the entire population making purchases or paying bills via the internet, online payments in the country nonetheless rocketed to $313.6 million over the course of 2018.

As of the end of last year, just 49% of the population had a bank account. E-wallets are quickly supplanting the need for traditional banking services, with alternative payment platforms soaring in popularity and, in some cases, seeing numbers of transactions increase by millions in just a few months’ time. Peer-to-peer payment platforms make up over 30% of the entire fintech market, and a growing demand for e-commerce promises to continue pushing the market forward.

The Philippines

In early 2018, the Philippines’ central bank laid out a policy plan to see at least a fifth of the country’s transactions go electronic within two years’ time, bringing digital payment adoption up from about 1% of total payments – as it stood in 2017 – to a projected 20% in 2020.

With 65.5% unbanked and 71% active internet users, local fintech companies have swooped in to fill the void, raising $78 million in funding in 2017 alone – an increase of 13 times the amount raised the year before. As more options for mobile banking have come onto the scene, 54% of the Philippines’ internet users have registered for at least one mobile banking app.

Within the Philippines’ fintech landscape, a third of all companies registered in mid-2018 were payment platforms, with “alternative finance” close behind at 30% and blockchain companies representing a solid 16% chunk of the market, according to a startup report by Singapore Fintech News.


As of the start of 2019, Vietnam is home to 66% internet users, with 94% of those users online every day. Mobile internet connections are getting faster than ever, and both data and internet-ready devices rate a 7 out of 10 for affordability, according to a report by global media agency WeAreSocial. The Vietnamese fintech market is likely to grow to $7.8 billion in 2020, up from the $4.4 billion of 2017, according to forecasts by consulting firm Solidance.

Government officials have announced plans to make Vietnam a cashless society by 2020, reducing the number of cash transactions to under 10% in traditional consumer markets like malls and grocery stores – a deadline that is rapidly approaching. These same plans seek to ensure more than 70% of Vietnamese people over the age of 15 own a bank account within a year’s time. As of last month, only 31% of adults had bank accounts – the same percentage as in 2017 – and only 4.1% of citizens owned a credit card.

As in many countries across the region, the unbanked are turning to fintech to ensure the ease of financial transactions: approximately 50% of the country’s internet users are using mobile banking platforms, 39% are making mobile payments, and 9.3% own some form of cryptocurrency.


Thailand is advanced in terms of internet use, with 82% of its population on the worldwide web and 74% of its internet users engaging in online banking each month. Of all internet users, 47% make mobile payments and 71% purchase goods online using their phones each month.

But while Thai people are active online, they’re also highly banked. With 82% of the population owning at least one account with a financial institution, Thailand is a slightly less friendly market for the types of fintech payment platforms that are attracting millions of users in other countries; it attracts less investment for lending platforms overall.

That said, Thailand is still at the forefront of fintech as it has become a leader in all things crypto, fostering different forms of fintech. Approximately 10% of internet users own some form of cryptocurrency – securing Thailand the second spot globally for crypto ownership, after only South Africa – and the Thai government actively supports locally-founded crypto coins and exchange platforms.

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