FinanceVietnam2020
Trendwatch

The race to build super-apps, platforms and communities

By Foo Boon Ping

As fintechs and big technology players are increasingly developing their platforms and apps, the financial services industry is in serious need of developing their technologies or collaborating in order to keep up with their disruptors

Platforms and ecosystems are the latest buzzwords in the financial services industry. Banks and financial institutions that have traditionally operated as monoliths, owning huge proprietary distribution and sales networks and being part of largely opaque industry associations, are now embracing open ecosystems, platforms and learning to create communities of loyal active users around them.

Fintech and big tech players are demonstrating how the open approach allows them to leverage the network effect to create super-apps that are helping grow active user bases at an exponential rate. It is not about owning product capabilities and selling products and services anymore but about technology enablement and using the power of data to match buyers and sellers. Platforms do not just make money from the traditional sales process but by facilitating transactions and monetising data.

New competitors from diverse industries from airlines to healthcare and wellness are working to disrupt conventional channels of financial services delivery and distribution by driving innovation and inclusion. For any of these platforms to succeed, data is becoming an increasingly important driver of growth.

The focus is now on building the super-apps, platforms and communities. There are the big tech companies such as Amazon, Google and Facebook getting into the payments space on the back of their strengths in ecommerce, search and social media. In Asia, even more traditional industry players such as regional low-cost airline, AirAsia, is looking to enter the platform play by introducing “BigPay” to disrupt payments and financial services, joining their newly minted unicorn counterparts, Grab, Gojek and Line.

Founder and CEO of Wikipedia, the online encyclopedia that many Google searches inevitably lead to, Jimmy Wales, believes that beyond selling products, banks need to transform themselves to be more open. There is still too little collaboration within and outside of the industry and where there are, they tend to be “minimal and heavy-laden partnerships.”

Still, there remains enormous opportunities for collaboration and areas to create new ecosystems and platforms to better serve consumers. One such possibility is in the area of corporate employee benefits programmes. Rosaline Chow Koo, founder and CEO, CXA Group, an online corporate health and wellness benefit platform, believes that a technology and data enabled platform has the potential to meet the comprehensive needs of users across multiple facets of healthcare, wellness, financial services, insurance, lifestyle and lifecycle.

Traditional players, such as the banks, insurers and even third-party administrators and brokers have been somewhat complacent. They have not focused on understanding, let alone building the necessary technology and business model to truly enable and empower users. But new platform players such as CXA have, and the potential for them to deliver an efficient, accessible and valuable proposition is hugely promising. They are not looking necessarily to disintermediate all traditional players, who have useful capabilities and more importantly access to customers, but those that are inefficient and adding unnecessary layers of costs.

The challenge for incumbents to succeed in this new world of platforms and communities, especially where they may not have developed the technology or business model to compete, is to be open to partnering those who have. Beyond the minimal or heavy-laden engagements. 



Keywords: Platforms, Fintech, Technology, Disruptors, Bank Apps, Mobile Wallets
Institution: Amazon, Google, Facebook, AirAsia, Grab, Gojek, Line, Wikipedia, Google, CXA Group
Country: Asia Pacific
People: Jimmy Wales, Rosaline Chow Koo
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