Singapore’s digital banking sector has been attracting much interest since regulators gave the green light for a wave of new banks, backed by the likes of tech giant Grab and legacy lender Standard Chartered, to operate in the Asian financial hub.
GXS Bank – a consortium comprising ride-hailing firm Grab and telecoms company Singtel – unveiled its virtual offering late last month, with CEO Charles Wong saying it was designed to “support the needs of entrepreneurs, gig economy workers” and early-career professionals. The new banks have managed to drum up some excitement by offering new customers bonuses and rewards, but Zennon Kapron, director of fintech research and consulting firm Kapronasia, questioned how long this could be maintained.
“Of course, [the new players] can be better at technology or at developing new products but the same is true for the current banks,” he said. “Unbanked individuals are not using banks for many reasons and I am not sure if the new banks will address all those issues,” he said. “And even if they do, it might not be very profitable for the banks.”
Seah said it was important for the newly launched banks to build trust among customers by ensuring data privacy, minimal service disruptions and compliance with regulatory requirements to avoid negative publicity.They could also carve out an advantage by exploiting cross-platform interactions.
Source: News Formal (newsformal.com)