The State Bank of Vietnam published a research note on how fintech is reshaping financial services in ASEAN, arguing that fintech and traditional banking can be mutually reinforcing rather than purely competitive. The note points to deeper regional integration through the ASEAN Financial Innovation Network (AFIN) as a way to strengthen the fintech ecosystem, support trade and advance more integrated cross-border payment connectivity. The analysis cites growing and relatively resilient fintech investment in the ASEAN-6 economies, with the region’s share of global fintech investment rising from 2% in 2018 to 7% in 2022 (around USD 4.3bn), and a decline of under 1% in 2024 versus a 28% global drop, with Singapore, Thailand and Indonesia accounting for more than 76% of regional fintech capital. It highlights fintech’s use of technologies such as artificial intelligence and big data to streamline credit processes and improve risk assessment, including an example of Funding Societies, which has disbursed more than SGD 5.87bn (USD 4.38bn) to over 100,000 SMEs across several ASEAN markets and processes nearly 95% of SME loans in under five days. The note also references Indonesia’s tightening of rules for peer-to-peer lending from 2024, the Philippines meeting its target to digitise 50% of retail payments by 2024, and a 2024 study suggesting fintech credit can help offset diminishing marginal growth effects from traditional bank lending, particularly in countries with high bank lending penetration. AFIN is described as established in 2018 by the International Monetary Fund, the ASEAN Bankers Association and the Monetary Authority of Singapore, including controlled fintech sandbox environments aimed at facilitating bank–fintech collaboration.

Original source View in tracker