Introduction to Fintech

What is Fintech? Fintech can be defined as the process of utilizing innovative technology to render aid and improve monetary/financial services like payment, insurance, fundraising, payment, etc.

The world's biggest podium for the global Fintech society took place from 12th to 16th November 2018. Singapore Fintech festival 2018 hosted different interesting events such as the Fintech conference and exhibition global, Fintech hackcelerator demo, a1 in finance summit, Fintech awards and many more. There is also a investor summit consisting of "Fintech deal day" and a brand new component named "meet ASEAN's talents and champions."

ASEAN Fintech opportunities

Singapore's Fintech sector has made remarkable improvements with over 400 Fintech organizations in the nation alone this year. In Singapore, the monetary sector covers over 12% of the economy and provided work for nearly 200,000 workers. The government has initiated measures in 2016 to form 3,000 net jobs in monetary services with an additional 1,000 jobs in Fintech each year to encourage its goal of developing into a leading Fintech hub.

Finance and transfer solutions, a specific sector of Fintech is deemed as a specifically diplomatic sector in Singapore. These products that entail Grabpay and Paynow majorly aims at improving the encounter of swapping fund and paying for products purchased online or from brick-and- mortal outlets. Fintech applications that influence huge data such as artificial intelligence (AI) to create correct credit outline and renders fund lending services have also risen drastically, including investment applications and robo-advisors like stash away, bamboo or smartly.

Yet in 2018, Regtech, a sector that where regulators have been very supportive of, benefited Asia greatly, especially Singapore and Australia. In Singapore, technologies are meant to aid the country to become a mainly cashless society. Singapore hosts a couple Regtech players like Datarama, which gives a threat organization podium to enable fulfilment – effective and less expensive, and autonomous which utilizes blockchain technology to transform the way firms are incorporated, funded and administered. The Singapore Exchange (SGX) currently initiated members surveillance dashboard which enables data associated to market misconduct to be reported, similar to alerts from SGX's owned surveillance system.

Singapore is currently pushing for district teamwork in Southeast Asia, similar to the growth of a district Fintech novelty sand-box. Therefore, Singapore Fintech festival 2018 in November will focus mainly on ASEAN. The Monetary Authority of Singapore (MAS) is beginning to put in efforts on financial addition and began to focus its attention on supporting insurtech novelty.

Chai Tek Yew, the head of financial services advisory KPMG in Singapore said that in ASEAN, they are beginning to see another stage of the Fintech with Chinese Fintech companies setting their sights on nations in the sector as another stage in their development agenda.

According to KPMG, Singapore Fintech will continue to observe 2018 as a year of implementation and also a year of regional development above local shores. Also, the investors were swift to invest their money into new start-ups in upcoming sub-division of Fintech like Regtech without thinking of failure.

Artificial intelligence (AI) in finance

Many financial organizations are beginning to notice the authority of recent technological advancement. They discovered the beauty of how artificial intelligence (AI), machine learning, and blockchain technology can enhance the client’s user experience. They discovered that there is a huge potential going into prospective markets and they can earn income faster while improving regulatory and observance efforts.

The centre for finance, technology and entrepreneurship, in collaborations with Ngee Ann Polytechnic initiated an online course “Artificial intelligence in finance”. This smart stream has gathered together a team of experts, which consists of mathematicians, applied data scientists, and computer scientists. This team concentrates on exploring and deploying artificial intelligence, machine learning and blockchain models with the monetary organization, to drive down rates and boost workflow efficiencies – taking benefit of advanced data analytics to re- engineer local work models across middle and back-office procedures

This innovative team is currently working with smart stream's banking partner who is adopting this technology. The objective of the technology is to develop new data-driven solutions and business models designed to provide innovative infrastructure to improve their business strategy. Through the adoption of this new technology, firms will benefit in the following areas:

  • Reduced operational risk, which is the capability to notice anomalies in transactions
  • Increase in income effectiveness due to the displacement of manual, repeatable task
  • Quicker response time as a result of artificial intelligence learning
  • Informed business insights
  • Staff can focus better at work or plan decision rather than doing repetitive tasks
  • Stay competitive by adopting fresh algorithms
  • Identification of patterns giving customized offerings to clients

Future of money

There are different types of Fintech products. The most creative Fintech product is those that render payment and transfer of funds solution. These products such as PayPal, Grabpay, Paynow concentrates on improving the experience of exchanging fund and paying for products purchased online or from brick- and-brick-mortal outlets. Paynow, which is a peer-to-peer money-transfer service incorporated into the digital banking podium of partaking banks, has over 1.4 million users and processed more than 9 million transactions. Since it was initiated, Paynow users can use this service to perform the operations such as paying bills and receiving payments.

Fintech application that provides money lending services uses this function to better understand the local bank’s profile in a better way. Therefore, these Fintech investment applications attract customers by reducing payment steps such as disbursal through the additional intuitively branded interface. This application can utilize huge data and artificial intelligence to create better and correct views of someone's credit profile or capability to pay back a loan. Hence, it can help bank will sieve out the possible potential borrowers that are overlooked by the more prominent financial institution (banks).

To maintain the competition in Singapore's financial sector, ideas have been set in place by the government since 2016 to encourage improvement and build an environment where both recognized banks, as well as Fintech start-ups, can research with new technology in a secure space.