Competition is heating up between fintech and traditional bank payments, with record investment growth in global fintechs, while Asian corporates are increasingly attracted towards payment services from non-bank fintech providers. Firstly, a report from KPMG found that global fintech investment grew at a record pace in the first half of 2018, with US$57.9 billion invested across 875 deals. This is a significant increase on the US$38.1 billion invested in all of 2017, according to the KPMG Pulse of Fintech report.
And research by East & Partners suggests that innovative digital payments and settlements provided by non-bank fintech companies are increasingly appealing to corporate customers in Asia. The research found that a significant portion of corporates in Asia are attracted to non-bank payment service providers and many are considering switching at least some of their payment needs away from the banking sector. The study was announced at a briefing in Hong Kong this week, as reported by Global Trade Review. GTR reported:
- more than 50 per cent of Asian corporates are considering switching to non-bank providers for part of their payments services; and
- 19 per cent are considering shifting their payment services to the non-bank sector.
The research from East & Partners also found that corporates in Asia are struggling with some areas of cybersecurity and technology, for example:
- more than 20 per cent experienced a cybersecurity breach in the past year;
- 40 per cent did not know whether or not they had been breached;
- roughly 33 per cent expect to start using biometrics in the near future as part of secure payments authentication;
- nearly all large corporates still use cheques;
- fewer than 20 per cent use mobile payments.
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