Financial Services Update: March 31, 2020

Financial Services Update | March 31, 2020
Authors: Michaela Wong, Nick Zuroski 
 
 
THE COUNCIL'S TAKE
 

Commercial Banks Across ASEAN Continue Economic Relief From the Bottom Up

As multiple ASEAN member states launch expansionary financial and monetary policy through public stimulus packages and central bank initiatives, the commercial banking sector has been elevating its efforts to combat COVID-19’s economic impact. 

In Malaysia, United Overseas Bank (UOB) recently rolled out substantial financial flexibility policies for corporate clients, especially small and medium-sized enterprises (SMEs), as well as for affected individuals.  The program includes a moratorium on loan repayments for up to one year, extension of trade bills maturing between March 18 and 31, moratoriums of up to six months on personal loans, and interest-only repayments or payment holidays for credit card repayments.  On March 19, HSBC Malaysia announced liquidity relief measures for personal and commercial banking customers, including interest/profit-only payments, moratoriums for up to six months, and repayment flexibility with extension of trade loans/financing payment period for 30 days.  An RM 100 billion credit restructure was announced by Bank Negara Malaysia (BNM) on March 24, with individual relief measures allowing six-month moratoriums on individual and small and medium enterprises (SMEs), restructuring of corporate debt, and the option to convert credit card debt to personal loans.  Multiple commercial banks announced that they will not compound interest or profit rates on loans following the BNM move, such as OCBC Bank, Malayan Banking, CIMB Group Holdings, RHB, Public Bank, Standard Chartered Bank, et al.

In Thailand, the Thai Banker’s Association Chairman Predee Daochai stated that all banks have a sufficient supply of cash ready for withdrawals among the country’s 6,800 branches and 54,000 ATMS.  In the Thai government’s recently proposed stimulus package, commercial banks would distribute $3 million in soft loans for those for firms in the tourism industry, one of the sectors most negatively impacted by COVID-19.  Meanwhile, as demand for insurance policies rises in anticipation of virus-related costs, some insurance companies have ceased lump-sump payouts and are adjusting for underwriting risks.  Siam Commercial Bank (SCB) announced a new COVID-19 insurance product with Deves Insurance that offers lump-sum payment and coma coverage, but informed its customers on March 24 that it had stopped selling the policies as sales volume reached their quota.

On March 17, commercial banks in Vietnam lowered interest rates on savings accounts with terms of less than 6 months, with Vietcombank cutting its rate from 4.8% to 4.7% for the three-month term and Viet Capital Bank lower from 4.85-4.9% to 4.7% for terms of one to less than six months.  HDBank has reduced domestic payment transaction fees by 50% and ABBank has provided a $172 million loan support package for hurting firms. 

In the Philippines, BDO Unibank Inc. has begun offering 60-day extensions for credit card, auto, home, SMEs, and personal loan customers.  For customers with no past due balances, Security Bank Corporation (SBC) has extended credit card and loan payments by 30 days.  China Bank is allowing a 30-day grace period for consumer loan customers with good credit standing and payment after 30 days for loan amortization due between March 15 and April 15 to be paid without a penalty. 

The comprehensive financial relief measures come amid commercial banks’ developing classification as critical services and industries during strict quarantine procedures in a few ASEAN member states.  The stringent Movement Control Order (MCO) issued by the Malaysian government established banking and financial services as an essential industry allowed to remain open, but has required some branches to close or others to remain open at reduced capacity to enforce social distancing.  In the Philippines, Governor of Bangko Sentral ng Pilipinas (BSP) Benjamin E. Diokno stated in a memo that the government is simplifying procedures for banking officers and personnel during the country’s COVID-19 lockdown.  Thailand’s March 25 emergency decree classified banks and financial institutions as essential goods and services that will continue to operate.  Digital banking has also emerged as an effective innovation, with Bank Negara Malaysia encouraging the use of electronic banking channels and Rizal Commercial Banking Group in the Philippines seeing a 259% increase in online banking sign ups. 

Indonesia and Malaysia Re-Examine Financial Market Procedures During COVID-19 Craze

In response to extreme fluctuating market conditions stemming from COVID-19’s financial effects, the Indonesian Financial Services Authority (OJK) issued Circular Letter SEOJK 3 on March 9 stating that all issuers or public companies will be allowed to conduct a shares buyback without first holding a general meeting of shareholders.  The letter noted that the Indonesian Stock Exchange (IDX) faced extreme market conditions during the global spread of COVID-19, such as an 18.46% index decline from the start of 2020 to the date of the letter’s issuance. 

On March 16, OJK also issued Circular Letter POJK 2, clarifying that the deadline for public companies to submit a disclosure of information to OJK and the Indonesian Stock Exchange (IDK) is seven exchange days after SEOJK3 is revoked at some point in the future.  In addition, the letter states that public companies aiming to resell bought back shares in the IDX’s negotiated market are not allowed to sell below the average price at which shares are repurchased by the relevant public company or below the average closing price for 90 consecutive exchange days in the IDX before the date of the sale of the treasury shares.  Indonesia also for the first time in history shortened its stock exchange’s trading hours to prevent unstable selloffs, with the market open for four hours as of March 30 instead of five and a half.  In a similar move on March 19, Vietnam’s Ministry of Finance reduced fees for four types of services on the derivative securities market, while the Philippines relaxed rules surrounding the document submission process in the peso-dollar foreign exchange market.

In Malaysia, Bursa Malaysia Securities Bhd has also temporarily relaxed margin financing rules from March 27 to September 30 to prevent domestic/foreign investors and market participants from facing forced selling pressure, especially those with margin accounts.  For example, the mandatory liquidation requirement should a client’s margin account of a Participating Organization’s (PO) fall below 130% of the outstanding balance has been removed, and investors may provide other types of collateral for margin financing as needed.  POs are also not required to request for additional margin or impose haircuts on collateral and securities purchased and carried in margin accounts in the case of irregular quick changes in securities’ values, erasure of an active market for securities, suspension of securities trading, or impossibility of immediate liquidation of securities. 

Indonesia Receives $300m World Bank Loan for Country’s Financial Sector

On March 23, the World Bank announced its approval of a $300 million loan for Indonesia aimed at financial sector reforms.  The loan seeks to strengthen Indonesia’s financial sector in an effort to prop up the financial security of the country’s middle class.  Indonesia and Timor-Leste Country Director Satu Kahkonen said that “a sound and well-functioning financial sector is critical to sustain Indonesia’s growth and achieve the government’s economic growth and poverty reduction goals, particularly amid the continued challenging global tensions,” such as COVID-19-related global supply chain issues. 

The loan focuses on three areas of policy reform: increasing the size of the financial sector by widening its outreach; increasing the efficiency of the financial sector through transparency and technology initiatives; and strengthening the sector’s sustainable finance and disaster risk finance mechanisms.  The funding is a component of the World Bank Group’s Country Partnership Framework for Indonesia.

The reform package emphasizes the need for financial inclusion measures to lift up consumers living in poverty and increase the utility of financial services for businesses within the region.  Poverty statistics remain bleak in Indonesia, with 9.22% of the population living under the poverty line as of September 2019 and the poverty rate declining only 1.7% between 2014 and 2019 – the slowest decline rate over the last 40 years.  In addition, nearly half of Indonesia’s population lack access to a formal bank account, especially segments of the population that live in underdeveloped rural areas across the archipelago’s 17,000 islands. 
 

IN THIS UPDATE
 
 
Market Development
SCB brings Ripple-powered cross-border payments to biz customers
Ripple strengthens presence in Asia with fintech DeeMoney 
Riel money in the digital era
Two in three Singaporeans interested in using neobanks: Visa study
Thai Fintech DeeMoney Partners with Ripple for Cross Border Money Transfers
MOU between Wing and FASMEC inked
Digital banking – how simpler regulation is catalyzing growth
Bank Mandiri turns to Microsoft amid digital ambitions
Islamic Fintech Startups On The Rise In Southeast Asia
Cambodia’s Law on Financial Management
OCBC Enables Encashment of Cheques at ATMs
UOB, Prudential launch savings account with insurance cover
Millennials are creating big opportunities for online travel investors in SEA
Grab Malaysia eyes digital banking business
More Filipinos Turn to Digital Banking Amidst COVID-19 Lockdown
Millennials poised to drive the Philippine home loan market
Philippines' Fintech Industry Group Drives Cashless Initiative Amidst COVID-19 Outbreak
5 Cybersecurity Startups Serving Fintechs and FSIs in Southeast Asia

Asset Management
Ministry tightens corporate bond issuances to prevent risks
CP Group secures funding for US$10.6 billion purchase of Tesco stores
Oriente secures US$20-M funding to fuel Cashalo's expansion in PH
Thailand's Corporate VC Firm Krungsri Finnovate to Invest $10 Million in Three Startups to Improve Country's Digital Infrastructure
Krungsri Finnovate of Thailand eyes investment opportunities in tech startups in Cambodia
Market regulator agrees on financial leveraging for UPCoM stocks
Singapore startup using blockchain to keep certificates gets seed funding

Banking
Thai cenbank says banking system ready for services during virus outbreak
PM says loan moratoriums, credit restructuring worth RM100b
Fitch downgrades outlook for Philippines banks to negative
OJK relaxes debt payment, loan quality assessments amid COVID-19 pandemic
Electronic settlements encouraged
MatchMove Confirms Singapore digibank bid
Banks, MFIs asked to delay loan repayment
BBL seeks digital boost from Permata
In Southeast Asia’s Virtual Banking Race, Incumbents Might Have An Early-Mover Advantage
Deutsche Bank Strengthens APAC Lending Management
Loan repayment suspension of garment workers get the nod
Digital Banks' Efforts to Engage Unbanked Seem Limited
Razer to tap legions of gamers in Singapore digital banking bid
Vietnam's New Guidelines on Bancassurance Agreements Between Banks and Insurers
Brunei banks agree to defer repayments for select business sectors amidst COVID-19 outbreak
Six-month moratorium on bank loans, restructuring of credit card payments
Agrobank offers moratorium, restructuring of financing for SMEs
RAM: Slower loan growth seen for banking sector in 2020 
BSP outlines additional relief measures for banks

E-Payments
Digital Banking Transactions Continue Surge In Philippines as Quarantine Enters Week 3
Grab and Gojek buck coronavirus; raise over $2bn combined 
Wing hosts delegation to showcase latest e-payment facilities
Wirecard and Southeast Asia Super App Grab Announce Payments Partnership to Drive Cashless Economy for MSMEs Across the Region
Banking on a cashless future
Australia inks digital economy pact with Singapore

Insurance
FWD Philippines adopts digital underwriting engine
General insurance premiums rise 8% in Singapore
Covid-19: Insurance policy holders can undergo screenings in private hospitals
Oldest Indonesian Bank Draws Bidders in Revived Unit Stake Sale
Prudential buys exclusive rights to sell insurance via Thai bank
AIA Singapore to provide 50,000 video medical consultations for its HealthShield Gold Max policyholders
Malaysian Life insurance industry registers healthy growth in 2019
Hong Kong's AMTD Digital to acquire Singapore insurtech startup PolicyPal
Leading Malaysian insurer to bring “Fast & Easy” insurance to the local market
Indonesia court revokes health insurance premium hikes
Aviva announces exit, sells entire stake in Indonesian joint venture
Insurance companies, takaful operators review operating hours during MCO
Covid-19 poses no immediate downside earning risks to insurance industry

Market Regulation
20m register for financial aid
NBC issues licence to SBI Lyhour Bank Plc
NBC’s directive to restructure credit targeting four sectors
BSP eases banks' forex trading rules
First time in history: Shorter trading hours for Indonesian stocks amid COVID-19
Banks Reworking AGM Plans Around Gathering Limits
Jokowi relaxes loan settlements to help small businesses cope with COVID-19 effects
Central bank delays foreign ownership cap in payment services industry
Finance ministry to reduce some securities service fees
Ministry makes int’l accounting rules compulsory after 2025
BIBD urges public to use digital, cashless services
Traffic compound payments go online
All PLUS, LPT2 Highways will operate RFID lanes from April 1
Financial markets allowed to operate during lockdown
 
ARTICLE CLIPS
 
 
Market Development

SCB brings Ripple-powered cross-border payments to biz customers Finextra Research 30th Mar 2020
Thailand's Siam Commercial Bank (SCB) is set to open up its Ripple-powered consumer cross-border payments mobile app to businesses. Earlier this year, SCB tapped into RippleNet to connect to banking partners around the world, enabling customers to make cheap instant low-cost cross border payments through its SBC Easy mobile app. The service is primarily designed for Thailand's 4.9 million migrant workers from Cambodia, Laos, Myanmar, Vietnam and other countries in Southeast Asia. However, the bank is now looking to bring instant payments to its small business and enterprise customers. SCB and Ripple are also working on a QR code-based app that enables visitors to Thailand to use their home-country app for transactions without having to think about exchange rates.

Ripple strengthens presence in Asia with fintech DeeMoney  Fintech Magazine 25th Mar 2020
Blockchain solutions leader Ripple continues to strengthen its expansion into the Asia market through a partnership with Thai fintech DeeMoney. This decision was publicized at the end of last week as it shared that the companies would enter the second phase of their partnership. DeeMoney is the first non-bank institution in Thailand to sign onto the technology company. It is already processing a number of inbound transfers via the blockchain network between prominent exchanges and remittances corridors from South Korea, Indonesia, Singapore, and Israel as well as the Middle East and Gulf regions. DeeMoney offers its users same-day settlement into all Thai bank accounts, positioning itself as a strategic pay-out partner for international remittance companies. The partnership with RippleNet will further streamline the transfer process for a cheaper rate. As a part of the second phase of this partnership, DeeMoney will leverage RippleNet to facilitate outbound transfers from Thailand in order to determine the best partners in destination countries for global payments. As a part of its strategic expansion, Ripple partnered with Azimoto deliver faster and cheaper payments in the Philippines. The key way in which this will be done is via Ripple’s On-Demand Liquidity solution (ODL), which will be processed through Azimo’s platform. Azimo’s money transfer platform has over a million customers who are able to send money to over 200 countries worldwide.

Riel money in the digital era Khmer Times 24th Mar 2020
In the context of the Fourth Industrial Revolution, promoting electronic payments is considered as a vital tool for payment settlement and promoting financial inclusion. Fintech is a nascent industry in Cambodia, with the NBC working to upgrade the regulation that governs the financial sector and striving to reduce the risks of using digital wallets. The development of Fintech, including smartphones and the internet as well as data analysis, has hugely boosted the Kingdom’s financial sector. Last July, to complement the private sector regarding payments and remittances, the NBC launched the pilot Bakong project, a mobile payment application that will bring all payment services providers and banks onto a shared platform, allowing the user to experience fast and affordable services. The Bakong project, which is expected to be fully launched this year, will provide the backbone of the payment system in the Kingdom, connecting banks and payment service providers. By using the Bakong application/mobile app with banking functions installed on a smartphone, customers of financial institutions can make real-time fund transfers across banks and financial platforms. In addition, it allows users to transfer funds in both riels and US dollars to one another across the platform from anywhere with internet access. It is said to be safe, easy, fast and free with the Bakong platform. Currently, there are 12 financial institutions that have joined the system, including ACLEDA Bank, Foreign Trade Bank (FTB), Wing (Cambodia) Ltd, Specialised Bank, Cambodia Post Bank, Sathapana, Canadia, Chip Mong, AMK and Speed Pay. Beyond the Bakong project, the NBC has also made other noticeable moves to promote the local currency and financial inclusion through cross-border QR Payment. This initiative has led toward the signing of a memorandum of understanding (MoU) between the National Bank of Cambodia and Bank of Thailand in February 2019. The MoU aims to promote more efficient cross-border payment transactions as well as the usage of local currencies in the market and has contributed significantly to boost financial inclusion, facilitating cross-border trade activities and the growth of tourism.

Two in three Singaporeans interested in using neobanks: Visa study Finextra Research 24th Mar 2020
Close to 65 per cent of Singaporeans are open to the idea of adopting a digital-only bank, according to the Visa Consumer Payment Attitudes Study. Based on the study, 84 per cent of Singapore respondents indicated that they would be interested in using digital banking services offered by an existing bank. Seventy-five per cent of them are keen to bank with companies within the financial services industry and reputable companies that are not in financial services. Three in five (63%) respondents also highlighted that they are keen to bank with new startups. Among those who are open to digital banking services offered by non-banks, six in ten (60%) are willing to switch some services from their current bank to new digital banking players which have no prior banking experience. One in five (20%) respondents also shared that they would move all their services to a neobank without hesitation. Respondents are lured by sign-up promotions, more innovative products and services and access to better rewards when choosing to use digital banking services from a non-bank. The top services that respondents would use a digital bank for include money transfers to family and friends (64%), paying bills (63%) and payments at retail shops (56%). The top reasons why Singapore respondents prefer digital banks include convenience (54%), faster service (52%) and not needing to wait in line (45%). Information that respondents are most willing to share with regard to open banking include bank account history (67%), contact information (64%) and social media profile (63%). Singaporeans trust banks (62%) the most when it comes to access to personal information, followed by government bodies (58%) and payment providers (58%).

Thai Fintech DeeMoney Partners with Ripple for Cross Border Money Transfers Fintech Singapore 23rd Mar 2020
DeeMoney, a fintech company based in Thailand specializing in digital cross-border money transfers, today announced its platform is now processing live transactions, in partnership with Ripple. DeeMoney is the first non-bank institution in Thailand to use RippleNet. As recent as January, Ripple has also successfully secured a partnership with Thai-based Siam Commercial Bank. Aside from Thailand they are also seeing success in other South East Asian countries where they have secured partnerships with Philippines’ based Azimo, and Malaysia based MoneyMatch and CIMB Bank. The Thai startup is currently using RippleNet to process inbound payments into Thailand; namely between the remittance corridors from South Korea, Indonesia, Singapore, Israel as well as the Middle East and Gulf regions. Currently, it is estimated that there are around a million Thais working globally who are transferring money back home. DeeMoney provides same-day settlement into all Thai bank accounts, making it an effective pay-out partner for international remittance companies with volumes into Thailand. With RippleNet, the transfer process is more efficient for those sending money from the growing number of financial institutions, and at the best possible rates.

MOU between Wing and FASMEC inked Khmer Times 21st Mar 2020
With the new partnership, FASMEC members will receive the new experiences with Wing’s products and services which is innovative and designed for micro, small and medium enterprises (MSMEs). Wing’s products will help the SMEs to manage their daily business easily both within the internet  and off-internet system by using the solid eco-system and 7,500 wing’s agents across the country. Established in 2010,  FASMEC is a group of small and medium enterprises in Cambodia, with more than 300 members owned by various businesses across Cambodia. The federation was created with the aim of promoting the growth of small and medium enterprises in Cambodia through the integration of regional and global markets. As one of the leading mobile banking services providers in Cambodia, WING is now one of the most recognized and trusted brands in mobile and electronic payment services and has partnered with more than 40,000 merchants, and partner with Mastercard, Western Union, MoneyGram, Wechat, and Alipay.

Digital banking – how simpler regulation is catalyzing growth Tech Wire Asia 17th Mar 2020
Digital banking is soaring in Asia. Amid the entry of disruptive fintech players, central banks and governing regulators are reacting to the trend by issuing digital banking licenses – or at least working towards it. The aim is to provide opportunities for players like e-wallet and e-lender operators to be able to play an active role in financial markets, scaling up their accounts and users, despite not having any established record in banking. Bank of Thailand’s Deputy Governor Ronadol Numnonda, for one, believes that digital banking will change the financial industry dynamics in the country, as new players enter. This type of innovation can stimulate the economic growth, enabling more flexible payment options and ramping up competition between existing players and new rivals. Singapore, meanwhile, has issued five digital banking licenses,with 21 contenders already tendering their application – demonstrating just how much demand there is for a seat at the table. The Monetary Authority of Singapore (MAS) will be revealing successful applicants in the middle of the year. In December, Malaysia released a digital banking licensing framework. It’s a tactical move that has attracted the Malaysian arm of Singapore ride-hailing giant Grab. The company is reviewing the feasibility of the initiative before finalizing its decision. Grab has been viewed as a prominent contender as it has already secured a large e-payments-reliant consumer base, as well as even launching its own e-wallet. As well as providing a new source of income, entering into digital banking would help Grab’s objectives in supporting the gig economy workers it relies, whom it would be able to offer attractive services.

Bank Mandiri turns to Microsoft amid digital ambitions Channel Asia 17th Mar 2020
Bank Mandiri is acting on ambitions to embrace digital transformation in Indonesia through the deployment of cloud and artificial intelligence (AI) technologies in partnership with Microsoft. Alongside increasing market competitiveness, the collaboration is designed to enhance customer satisfaction, risk management, employee collaboration and business processes across the organization. Revealed on the sidelines of DevCon - Digital Economy Summit 2020 in Jakarta - headlined by Satya Nadella as CEO of Microsoft - the adoption of cloud, AI and machine learning solutions will help analyze millions of records and data points at the country's largest banking institution. The aim is to provide a knowledge graph of related information for better decision making, including credit risk evaluation and shortening the process for data processing, preparation and governance. According to IDC findings, commissioned by Microsoft in 2019, Indonesian companies using AI can expect to increase innovation rates by 1.7 times, alongside boosting employee productivity by 1.9 times within the next three years. The top five business drivers of AI adoption in Indonesia rank as improved customer engagement (40 per cent); higher competitiveness (17 per cent); higher margins (14 per cent); accelerated innovation (11 per cent) and productive employees (six per cent).

Islamic Fintech Startups On The Rise In Southeast Asia Forbes 13th Mar 2020
Islamic fintech firms in this region are providing digital services with wide appeal. The prime Southeast Asian market is Indonesia, home to the world’s largest Muslim population, at over 230 million. But some startups are already going global, as their online and mobile-first services have two notable advantages. The services—especially peer-to-peer financing and crowdfunding—can easily be used by the world’s 1.9 billion Muslims, and the tech-savvy firms are able to compete well with conventional Islamic banks. While media attention has focused on developments in the Persian Gulf region, Islam’s birthplace, multiple factors point to Southeast Asia as a rising powerhouse in Islamic finance. A main factor is the vast Indonesian market. Not only are 87% of the country’s 270+ million people Muslims, about two-thirds are currently unbanked—many in remote or rural regions—and the great majority carry cell phones. This makes them prime prospects for mobile-based fintech. Moreover, though Islam isn’t the state religion, Indonesia’s government actively promotes a progressive sharia economy. Malaysia, a fast-developing nation with over 20 million Muslims among its 33 million, does support Islam as the official religion and has long been a center of Islamic finance. Malaysia typically ranks third (after Iran and Saudi Arabia) in measures of sharia-compliant assets. The country is HQ for leading financial entities like Bank Islam Malaysia and the Islamic branches of Maybank and CIMB Group, as well as Islamic-savvy law and accounting firms and the international Islamic Financial Services Board. Singapore, where we sit, is small and only 14% Muslim. But it is the most highly developed ASEAN state and a hub of new tech industries. Now consider some fintech firms in this three-country swath of the world.

Cambodia’s Law on Financial Management ASEAN Business News 13th Mar 2020
On December 20, 2019, the Cambodian government issued the Law on Financial Management (LoF), which is issued annually and contains a number of updates to the Law of Taxation. The law has been in effect since December 21, 2019. The new law revises certain rules regarding taxes on dividend distribution, stamp duty, in addition to the rules governing the tax on income (ToI) of Cambodian branches of foreign companies. Foreign investors should seek the help of registered local advisors to assist them in staying compliant with these changes. The LoF introduced the advanced tax on dividend distribution (ATDD) as a new mechanism which levies companies that distribute dividends from retained earnings and thus ensuring they are subject to the appropriate ToI rates. The revised rules in the LoF in relation to ATDD are: • Qualified Investment Projects (QIP) that have distributed dividends to shareholders during a tax holiday period will not have to pay ATDD from January 1, 2020. QIPs are projects that are eligible to receive fiscal and non-fiscal incentives from the Cambodian Investment Board. They are divided into three types – domestic QIPS, export QIPs, and supporting industry QIPs; • Cambodian branch offices of foreign companies that repatriate profits to their head offices are subject to ATDD if the ToI on repatriated profits have not been paid; • Investors should note that branch offices that are repatriating profits abroad are still subject to the withholding tax rate of 14 percent; • The ATDD does not apply to general insurance premiums or the reinsurance premiums on properties; and • Businesses that have paid the ATDD will not be subject to the advanced tax on this dividend distribution again.

OCBC Enables Encashment of Cheques at ATMs finews.asia 12th Mar 2020
OCBC Bank has rolled out a cheque encashment service across all its next-generation ATMs at 23 branches, making it the first bank to offer such services in Southeast Asia. Recognizing that there are still segments of customers who require services like cheque encashments, OCBC has enabled its next-generation ATMs to process 90 percent of all the cheques usually encashed at its branch teller counters. Since February this year, customers have been able to encash cheques – for up to a maximum of $30,000 in a single cheque – by depositing them into the ATM to instantly get cash. As a result, the average cheque encashment transaction time has been reduced to under three minutes at the ATM, as customers can save about 60 percent of their time compared to waiting to be served at a branch. All the necessary security checks and verifications are performed by the lender's “digital ambassadors,” or staff located at its branch on mobile tablets in real-time, to ensure security. The next-generation ATMs have already processed cheque encashments totaling close to S$17 million, the bank said. Even as Singapore pushes to become cheque free by 2025, cash cheques continue to be used by small and medium-sized enterprises (SMEs), typically to pay staff salaries, get cash for daily business operations, or pay vendors for services rendered. While cheque usage by OCBC Bank’s retail banking customers has fallen 40 percent since 2018, one in six cash transactions performed by OCBC Bank tellers over the counter are still cash cheque encashment, with 95 percent of these cheques issued by SMEs.

UOB, Prudential launch savings account with insurance cover The Straits Times 9th Mar 2020
United Overseas Bank (UOB) and Prudential Singapore have launched a new savings account for women that provides free medical insurance cover for six cancers, including breast, uterine and ovarian. The UOB Lady's Savings Account also offers customers free annual health screenings and a yearly three-strain flu vaccination. The coverage amount, ranging from $1,000 to $200,000, is based on the account holder's monthly average balance over the previous three months. A 2017 survey by UOB and Prudential found that 45 per cent of women said they wanted a savings account that comes with free critical illness protection. More than 40 per cent of Prudential Singapore's total critical illness claims were from females in 2018, with the top two claims for breast and uterine cancers.

Millennials are creating big opportunities for online travel investors in SEA TechinAsia 27th Mar 2020
Looking toward integrating all stages of the booking process, from marketing to the point of purchase, the online travel sector hopes to expand the pie further by adopting and adapting to the myriad of online payment platforms available. Regardless of where a company exists on the digital travel value chain, the one thing they will all inevitably have in common is the need for a variety of connected payment methods. This is a big part of why investors believe travel tech is poised to boom for a second time, following the prevalence of fintech in the region.

Grab Malaysia eyes digital banking business The Malaysian Reserve 6th Mar 2020
E-hailing giant Grab Malaysia is exploring the opportunity to apply for a digital banking license in line with the rapid growth of the digital economy in the country. Country head Sean Goh said a feasibility study is underway before any firm conclusion and decision could be made. “Technically, it’s not open for application yet. It is too early for us to say anything. The most important thing is, driving growth and income through digital economy in an inclusive way is one of three main pillars that will be our focus in 2020,” he told The Malaysian Reserve (TMR). In December, Grab Holdings Inc and telecommunications company Singapore Telecommunications Ltd formed a consortium to apply for a full digital bank license in Singapore. “Grab has grown far beyond its ride-hailing roots. Since introducing the GrabPay wallet in 2016 and launching Grab Financial Group in 2018, it has built solutions in payments, rewards, lending and insurance,” it said in a statement. Bank Negara Malaysia (BNM) announced plans to issue up to five digital bank licenses in December. On Tuesday, BNM issued an updated exposure draft on the licensing framework for digital banks that incorporates the proposed simplified regulatory framework applicable during the foundational phase. According to a statement, the simplifications are aimed at reducing regulatory burden for new entrants that have strong value propositions for the development of the Malaysian economy, while safeguarding the integrity and stability of the financial system. BNM is extending the consultation period for the exposure draft until April 30.

More Filipinos Turn to Digital Banking Amidst COVID-19 Lockdown Fintech Singapore 24th Mar 2020
Rizal Commercial Banking Corp. (RCBC) logged a 259% increase on new sign-ups on its online banking service in the first three days of the implementation of the enhanced community quarantine (ECQ). Bank data show a daily average of 1,116 new enrollments from March 17 to March 19. This is more than double the average daily enrollment of 431 recorded in the same month before the enforcement of the ECQ. The biggest number of new sign-ups at 1,155 was observed in March 17, the first day of the Luzon-wide quarantine.

Millennials poised to drive the Philippine home loan market Manila Bulletin Technology 23rd Mar 2020
Millennials emerged as the fastest-growing generation to contribute to the growth of the home loan landscape in the country, according to PH’s first online mortgage brokering platform, Nook. As the platform disrupts the home loan process in the Philippines, millennials are seen to lead the industry as they express keen interest to invest in real estate properties.

Philippines' Fintech Industry Group Drives Cashless Initiative Amidst COVID-19 Outbreak Fintech Singapore 11th Mar 2020
Amidst the current contagion of potential pandemic proportions, the Philippines has reported a series of confirmed COVID-19 cases. Given the high risk of local transmission, the Fintech Alliance.ph has heightened its awareness campaign on the use of digital channels especially on reducing the handling of physical cash, which according to various advisories, may contribute to the spread of the virus.

5 Cybersecurity Startups Serving Fintechs and FSIs in Southeast Asia Fintech Singapore 27th Mar 2020
71% of industry participants consider data security and privacy protection to be the biggest cybersecurity issue to address, and 61% already apply anti-fraud applications, dynamic risk monitoring and user behavior analytics etc. to drive financial services. With cybersecurity being now so critical for fintechs, we look today at five cybersecurity startups serving the fintech and financial services industry in Southeast Asia. Most of these startups are newcomers and made significant achievements in 2019 including raising funding, and gaining support from notable organizations: Right-Hand, Keyless, OneKIY, Horangi, and Seconize.

Asset Management

Ministry tightens corporate bond issuances to prevent risks vietnamnews.vn 17th Mar 2020
The corporate bond market had seen exponential growth in recent years as banking credit for several sectors was narrowed, forcing firms to shift to bond issuance to raise capital, Nguyễn Khắc Quốc Bảo, head of the Financial and Bank Department at the HCM City Economics University, told Thời báo Kinh doanh (Business Times). “However, the booming growth of the corporate bond market implied significant risks as firms are issuing more bonds without clarifying the purpose of the capital they're trying to raise, repayment plans or bond yields,” Bảo said. In a move to change the status quo, the ministry has made public a draft decree to amend several points of Decree 163/2018/NĐ-CP about corporate bond issuance for comment in order to manage and monitor the current rapid growth of the corporate bond market.

CP Group secures funding for US$10.6 billion purchase of Tesco stores South China Morning Post 11th Mar 2020
Thailand’s biggest conglomerate Charoen Pokphand Group has locked in funding for its proposed acquisition of Tesco’s businesses in Thailand and Malaysia for US$10.6 billion, allowing its billionaire owner to build on its dominance at home and expand in the region. CP Group has turned to JPMorgan Chase, UBS and Siam Commercial Bank to underwrite the deal, according to people involved in the discussions. The transaction, if approved, represents the biggest merger and acquisition deal in Asia excluding Australia this year, and topping the pending US$6.2 billion Wheelock & Co privatization, according to financial data provider Refinitiv. The British grocer on March 9 agreed to sell its hypermarket businesses in Thailand and Malaysia to CP Group for an enterprise value, including debt, of US$10.6 billion. The deal also marks the biggest acquisition by owner Dhanin Chearavanont at home, recapturing the retail chain it established in 1994 and sold to Tesco during the Asian financial crisis. JPMorgan, UBS and Siam Commercial Bank plan to syndicate the loan to other lenders at home and around the region, the people said. Chinese banks could also be interested in the syndication, one of the people said. While Tesco expects the deal to complete during the second half of this year, it still faces possible hurdles. Tesco needs to secure shareholder approval as well as antitrust approval in Thailand. JP Morgan and UBS advised CP Group on the acquisition while Goldman Sachs, Barclays Bank and Greenhill advised Tesco. Freshfields Bruckhaus Deringer gave Tesco legal advice.

Oriente secures US$20-M funding to fuel Cashalo's expansion in PH Sunstar 10th Mar 2020
Oriente, the Hong Kong-based technology and data science company unlocking financial access for Southeast Asia, recently secured a US$20-million debt funding facility from Silverhorn Group, a leading Asia-focused multi-asset investment firm. The facility, which can increase up to US$50 million, will be used to grow Cashalo’s loan book and extend the reach of its fair, inclusive, and affordable digital-credit and Pay Later solutions to millions of undervalued and credit-starved consumers and micro-enterprises in the Philippines. This new funding is in keeping with Oriente’s commitment to invest and expand financial access responsibly in the Philippines. Since its launch, Cashalo has grown over 20 percent MoM. In less than 18 months, the app has been downloaded over 6.5 million times, grown its user base to over 2.5 million consumers and helped over 1.5 million previously "credit-invisible" Filipinos build financial identities for the first time. The deal marks a major milestone for Oriente as it is the largest debt financing with an institutional lender it has secured to date, which underlines the quality and bankability of its fast-growing loan book. For Silverhorn, this represents another high-potential investment in Asean and in the fintech sector.

Thailand's Corporate VC Firm Krungsri Finnovate to Invest $10 Million in Three Startups to Improve Country's Digital Infrastructure Crowdfund Insider 9th Mar 2020
Krungsri Finnovate, a corporate venture capital company operating under Bank of Ayudhya (BAY), the third-largest bank in Thailand in terms of assets, loans, and deposits, is planning to invest $10 million into the operations of three promising startups during the first half of this year. Krungsri Finnovate is also looking into various other investment opportunities in technology firms based in Cambodia, Indonesia, and the Philippines. The firm intends to firmly establish its operations in ASEAN markets. Krungsri Finnovate’s management notes that it is planning to expand the institution’s digital technology footprint in Thailand and other Southeast Asian nations. The firm has been holding discussions with several Thai companies. Three of these firms, which are being considered for the multi-million dollar investment, include Proptech, Agritech and payments companies. Krungsri will be finalizing agreements with these startups by June, according to Thakorn Piyapan, head of digital banking and innovation efforts at BAY. The $10 million being invested is reportedly half the amount Krungsri Finnovate raised for this year’s investment, Thakorn revealed. Thakorn said that the three startups will not directly work with banking services, however, they could potentially help improve Thailand’s ongoing digital infrastructure development efforts.

Krungsri Finnovate of Thailand eyes investment opportunities in tech startups in Cambodia Khmer Times 8th Mar 2020
Krungsri Finnovate, a corporate venture capital (CVC) firm under Bank of Ayudhya (BAY), plans to splash out US$10 million on three local non-fintech startups in the first half of 2020 and is also reportedly exploring investment opportunities in tech startups in neighboring Cambodia. Other countries being looked at are Indonesia and the Philippines, for business expansion in Asean markets during the digital age. The company has been in talks with several Thai startups. Three of them, representing proptech, agritech and payments, are expected to reach agreements by June, said Thakorn Piyapan, head of digital banking and innovation at BAY. The $10 million is half the sum Krungsri Finnovate has raised for this year’s investment, Mr Thakorn said, and the company can mobilise additional funds if needed. The CVC had initial funding worth $30 million when it was incorporated in 2018. This figure rose to $50 million when the latest $20-million fund mobilisation was included. Some of the $50 million was invested in Grab under parent Mitsubishi UFJ Financial Group Inc’s $706-million investment in the ride-hailing firm. Mr Thakorn said that while the non-fintech startups will not directly support banking services, they will benefit the country’s overall digital infrastructure development.

Market regulator agrees on financial leveraging for UPCoM stocks vietnamnews.vn 6th Mar 2020
Margin lending may be allowed on the Unlisted Pubic Company Market (UPCoM), the State Securities Commission (SSC) vice chairman Phạm Hồng Sơn said on Wednesday. The Hà Nội Stock Exchange (HNX) must make a list of stocks on UPCoM that are qualified for margin lending and submit the list to the SSC next week, he said at a meeting with investment funds and securities firms. The proposal will have to wait for the Ministry of Finance’s approval, the vice chairman added. The Vietnamese stock market has been struggling in the last two months as fears about the spread of the novel coronavirus (COVID-19) have dampened investors’ confidence in risky assets. If the margin-lending proposal is approved, it would be a boost for the secondary market, according to the SSC.

Singapore startup using blockchain to keep certificates gets seed funding TechinAsia 30th Mar 2020
Singapore-based Edufied, a credential validation startup, said it has raised an undisclosed amount of seed funding at a valuation of nearly US$4 million. Edufied offers a blockchain-based system that allows agencies to provide e-credentials easier. It reduces the amount of admin work needed and helps prevent fake certificates or claims from happening. Receivers, in turn, are given academic and training passports to store and share their credentials securely.

Banking

Thai cenbank says banking system ready for services during virus outbreak Reuters 25th Mar 2020
Thailand’s banking system is ready to provide continuing financial services during the coronavirus outbreak, the central bank said on Wednesday. Services are available through various channels, at bank branches and business offices, which will be open for service as often as possible, the Bank of Thailand said in statement. Thailand has reported 827 cases of coronavirus infections and 4 deaths.

PM says loan moratoriums, credit restructuring worth RM100b Malay Mail 25th Mar 2020
The government’s move to freeze loan repayments for six months due to the coronavirus disease will provide relief worth RM100 billion to Malaysians, Prime Minister Tan Sri Muhyiddin Yassin said on March 25. The PM said the unprecedented move Bank Negara Malaysia announced last night was the government’s response to public concern about hardships they are enduring due to the movement control order in place until March 31. Muhyiddin reiterated the measures announced on March 24, which include a six-month postponement of all individual and business loans for small-medium enterprises (SMEs), the option to convert existing credit card debt to personal loans, and the restructuring of corporate debt. Previously, the PM also announced additional measures such as allowing Malaysians to withdraw RM500 monthly from their Account II savings with the Employees Provident Fund for a period of 12 months. In his statement, Muhyiddin repeated that he will announce additional measures to preserve Malaysia’s economy on March 30, following deliberations at the Economic Action Council.

Fitch downgrades outlook for Philippines banks to negative philstar.com 25th Mar 2020
Fitch Ratings has downgraded the outlook on the Philippine banking sector to negative from stable as the coronavirus disease 2019 or COVID-19 pandemic is seen testing the asset quality and earnings of major players. The debt watcher said the revision could lead to a credit rating downgrade over the next 12 to 18 months. The revision took into consideration the rising asset-quality risks amid a deteriorating operating environment as a result of the global outbreak that prompted Malacañang to impose a month-long enhanced community quarantine in Luzon. The credit rater added further rate cuts would take its toll on the earnings of Philippine banks as the Monetary Board has slashed interest rates by 75 basis points this year to boost market confidence and prevent potential spillovers from external headwinds as well as to soften the impact of the pandemic. It expects more cuts in the next few months even if the central bank has slashed benchmark rates by 150 basis points, almost reversing a tightening cycle that saw interest rates jump by 175 basis points in 2018 due to an inflation breach. The BSP’s Monetary Board has committed to reduce the level of deposits banks are required to keep with the central bank by a maximum of 400 basis points this year, with the initial 200 basis points reduction taking effect on March 30 and freeing up as much as P200 billion to encourage banks to lend more and boost economic activity.

OJK relaxes debt payment, loan quality assessments amid COVID-19 pandemic The Jakarta Post 23rd Mar 2020
The Indonesian Financial Services Authority (OJK) has launched new stimulus to control the banking and non-banking industries’ bad loans ratio and ease loan repayment amid the COVID-19 pandemic that is expected to hit businesses. The first stimulus, regulated in a new OJK rule issued on March 26, relaxes debt quality assessment and restructuring requirements for debtors that are hit hard by the pneumonia-like disease spread. Banks now only assess the quality of a loan worth up to Rp 10 billion (US$ 594,282) based on a debtor’s timeliness in paying the loan’s principal and interest. Previously, the banks also assessed the debtor’s business prospects and financial condition. Banks are also allowed to declare a good loan despite declining quality due to the pandemic and to not categorize it as a non-performing loan (NPL). Debtors who restructure their loans will get improvement in their loan quality after the process and banks can implement such a policy for any loan amount. The rule is expected to reduce COVID-19's economic impacts on banks due to debtors’ slumping performance that could increase the risks of bad loans and disrupt the banks’ performances and the country’s financial stability, the OJK said added. The relaxations are also applicable for small and medium enterprises (SMEs), as well as the government’s microcredit program (KUR) recipient

Electronic settlements encouraged Khmer Times 22nd Mar 2020
The National Bank of Cambodia (NBC) is encouraging the use of electronic methods for settlements rather than using cash to prevent the possible spread of the COVID-19 pandemic. The central bank has called on and encouraged, particularly all government relevant organizations, banking, and microfinance institutions to jointly implement the announcement by using electronic services in transactions and clearances where possible. The move follows increasing infections in the country. “For Canadia’s customers, you can make financial transactions through our multi-functional Mobile Banking App or internet banking. ABA Bank Cambodia has also suggested its customers use digital transactions through which payment can be made with a QR code or ABA Contactless Card. Research by Visa Cambodia into consumer attitudes around different forms of payments found some 79 percent of those surveyed expected to use electronic payments in supermarkets, 61 percent in large shopping malls and 49 percent in chain and convenience stores. A WHO spokesperson said customers should wash their hands after touching banknotes because COVID-19 may cling to the surface for days. That is a view a growing number of businesses around the globe have adopted as the fear spreads. A US door-to-door delivery service recently reported it stopped accepting cash. A non-profit bookstore, Open Books in Chicago, also told its customer not to use cash. The Central Bank in South Korea reportedly took all banknotes out of circulation for two weeks.

MatchMove Confirms Singapore digibank bid TechInAsia 19th Mar 2020
Singapore-headquartered fintech startup MatchMove confirmed that it has applied for a digital full bank license in the city-state. It’s joining the digibank race with Singapura Finance, Lightnet, and OpenPayd. The consortium is proposing a banking-as-a-service platform that would provide safe banking services and serve gig workers and small and medium-sized enterprises. According to Shailesh Naik, founder and group CEO of MatchMove, the startup has formed a network of fintech businesses with a large access to retail customers and SMEs. Without being specific, he said that confirmed partners include a leading transport operator in Singapore, a leading insurance company in Southeast Asia, a regional payments acquirer, two startups focused on SME services, and an ecommerce enabler in Asia, among others. Naik added that the consortium is in advanced talks with other potential partners. The full digital banking bid is a natural next step for MatchMove, according to the statement. The startup currently offers what it calls a wallet-as-a-service platform, enabling customers to spend both online and offline via prepaid cards on major card networks. It also supports peer-to-peer domestic money transfers, cross-border remittances, as well as person-to-merchant and mass disbursements to global recipients. Early this year, the Monetary Authority of Singapore announced that it has received a total of 21 applications for the digital bank licenses. Contenders for the full digibank licenses include the Enigma Group-led consortium, Grab and Singtel, Razer, Sea, and the Beyond consortium.

Banks, MFIs asked to delay loan repayment The Phnom Penh Post 18th Mar 2020
Industry insiders and financial experts are urging local banks and microfinance institutions (MFIs) to temporarily suspend the repayment of loans to give borrowers breathing space as the spread of Covid-19 takes its toll on the economy. Cambodia Chamber of Commerce (CCC) vice-president Lim Heng said CCC is studying the impact of Covid-19 on the local economy to consider whether or not to request banks and MFIs to halt repayments. “We are collaborating with the banking sector, collecting data on which sectors have been hit the worst and are having problems repaying,” he said. Mekong Strategic Partners (MSP) managing partner Stephen Higgins told The Post that central banks in other countries have lowered the interest rates to help businesses. However, in Cambodia, due to the high dollarization of the economy, the National Bank of Cambodia (NBC) has little influence on this matter. Higgins said banks here need to keep interest rates high to bring in more dollars. If deposit rates are high, lending rates will need to be high as well. “This is exactly what we saw during the global financial crisis as well.

BBL seeks digital boost from Permata Bangkok Post 17th Mar 2020
Bangkok Bank (BBL) is aiming for significant growth in the digital banking business in Indonesia after its acquisition of PT Bank Permata. Permata, a leading digital banking service provider in Indonesia, can expand digital banking rapidly with a wide range of financial services, including 200 features, said BBL president Chartsiri Sophonpanich. The Indonesian bank's digital lending has recorded strong growth, with 385,000 new loan approvals a month, of which 31,000 are home loans. Permata, Indonesia's 12th-largest bank by assets at US$18 billion, launched its mobile banking app PermataMobile X 18 months ago with downloads hitting about 1 million. The solid growth of Permata's digital banking business will aid BBL's business expansion in Southeast Asia's largest economy, which has high economic growth potential and low household debt, Mr Chartsiri said. BBL, Thailand's second-largest lender by assets, last December entered a conditional share purchase agreement to buy an 89.12% stake in Permata for $2.7 billion from UK-based Standard Chartered Bank, making it the largest purchase of an overseas lender by a Thai bank. The acquisition aligns with BBL's strategy to become a leading regional bank with a bigger presence in Southeast Asia. After the acquisition deal is completed in the third quarter, BBL Indonesia will merge with Permata. Apart from digital banking there are several high-potential businesses in Indonesia, particularly trade finance, treasury and cash management. Permata's business operations and profit have increased over the past three years after the bank turned a corner.

In Southeast Asia’s Virtual Banking Race, Incumbents Might Have An Early-Mover Advantage Fintech Singapore 16th Mar 2020
In Southeast Asia, the imminent entrance of virtual banks is set to shake up the banking industry. But despite the potential disruption these are expected to bring, incumbent banks have a lead in the digital banking race, according to a new report by S&P Global Market Intelligence. By teaming up with local partners to gain new customers, introducing innovative features and services, and streamlining the onboarding process, incumbent banks that have launched stand-alone digital outfits “are steadily acquiring an early-mover advantage,” the firm said. In Indonesia, Digibank by DBS Bank from Singapore has incorporated self-service banking solutions such as an artificial intelligence (AI)-powered virtual assistant, as well as a budget optimizer that helps customers do their budgeting, track expenses and analyze purchasing trends. Meanwhile, Jenius, by Indonesia’s Bank Tabungan Pensiunan Nasional (BTPN), is a mobile banking application that makes it quick and easy for customers to manage their finances using their smartphones. In Vietnam, Timo and YOLO, both powered by Vietnam Prosperity Joint-Stock Commercial Bank (VPBank), provide customers with a full range of financial services, but also integrate other services catered to daily needs such as transportation, travel, entertainment and restaurant reservations. Digital banks in Southeast Asia have also articulated their strategies around the large population of unbanked in the region. Leveraging technology and digital platforms, these have focused on streamlining onboarding, as well as providing products that cater to the special needs of this population, the report says. CIMB Bank PH in the Philippines and Jenius in Indonesia, for example, offer an end-to-end remote account-opening experience through features such as selfie verification and video calls to confirm the users’ identity.

Deutsche Bank Strengthens APAC Lending Management finews.asia 12th Mar 2020
The two appointments were made to help drive the bank's growth in the region, with Strategic Lending a core capability for its wealth management business in emerging markets. Deutsche Bank has announced two senior appointments at its wealth management unit in Asia Pacific, with June Wong named Head of Emerging Markets Lending and Tony Tan (pictured below) named Head of Strategic Lending, Asia and head of Southeast Asia and Global South Asia Lending, both effective 1 May. The pair report to Arjun Nagarkatti, managing director, Global Head of Lending, who is based in London.

Loan repayment suspension of garment workers get the nod Khmer Times 12th Mar 2020
Garment workers in Cambodia whose jobs suspended due to raw material shortages are now allowed to delay their loan repayments to the commercial banks and microfinance institutions (MFIs). In a joint statement between the Association of Banks in Cambodia (ABC) and Cambodia Microfinance Association (CMA), the customers affected by the COVID-19 outbreak get the special loan repayment suspension. The move was made after Samdech Hun Sen, Prime Minister of the Kingdom of Cambodia, asked MFIs and banks to consider suspension of loan payments from garment workers whose factories face temporary closure due to raw material shortages in the wake of COVID-19 outbreak. The Association of Banks in Cambodia and the Cambodia Microfinance Association expressed their strong support for the measures taken by the Royal Government of Cambodia.

Digital Banks' Efforts to Engage Unbanked Seem Limited finews.asia 12th Mar 2020
Although digital banks have sprung up in recent years, their efforts to address the unbanked appear limited at the moment. Celeste Goh, a fintech analyst at S&P Global Market Intelligence, shares her observations with finews.asia in an interview. While these digital banks are not excluding the unbanked, they appear to be focusing their resources in major cities, says Celeste Goh, Fintech Analyst at S&P Global Market Intelligence. The account opening process at most digital banks, for instance, favors urban dwellers. For example, United Overseas Bank, which launched TMRW in Thailand, has placed its identity verification kiosks or agent meetup locations only in Greater Bangkok, while CIMB Group Holdings' OCTO has such kiosks and locations in Hanoi and Ho Chi Minh. Only digital banks targeting Indonesia cover slightly m0re cities – DBS Digibank placed its kiosks and agent meetup locations in Greater Jakarta, Bandung, Surabaya, Medan, Semarang, Jogya. Although bank account registration can be initiated in-app, only CIMB Bank Philippines and Jenius in Indonesia permit an end-to-end remote account-opening experience through features such as selfie verification and video calls to confirm the users' identity. For other banks, identity authentication is still required at physical venues, though some have streamlined the process by introducing biometric technology. To improve the financial inclusion figures in their own countries, regulators across Southeast Asia are warming up to the idea of virtual banks – Singapore and Malaysia are preparing to open the banking industry to digital players while the Philippines and Thailand expressed interest in developing virtual banking frameworks.

Razer to tap legions of gamers in Singapore digital banking bid Nikkei Asian Review 9th Mar 2020
Singaporean gaming hardware company Razer plans to branch out into digital banking by tapping its extensive die-hard customer base, hoping to provide financial services for the underbanked millennials in Singapore and beyond. Hong Kong-listed Razer, which has developed a loyal following among esports fans, offers gamers products and services ranging from high-performance gaming laptops to software, with its software platform being home to 80 million registered users worldwide. A consortium led by Razer is one of 21 candidates applying for five new digital banking licenses from Singapore's central bank. Up for grabs are two digital full banking licenses that can serve both retail and corporate customers and three wholesale licenses, in which the holders are not allowed to service retail clients. Razer is applying for the former. According to Razer's proposal, the company is set to establish the subsidiary Razer Youth Bank that will target millennials. Lee said the unit aspires to eventually expand to the Middle East and Western nations. "We are looking at building Singapore as the first country, but our ambitions are not going to be single country because it's just not big enough." Within six major Southeast Asian countries, only 104 million of the 400 million adults are fully banked. Even in Singapore, the region's most advanced economy where nearly everybody has a bank account, 38% of consumers are not well served or have unmet needs, according to an estimate by the state investment company Temasek Holdings.

Vietnam's New Guidelines on Bancassurance Agreements Between Banks and Insurers Lexology 9th Mar 2020
The State Bank of Vietnam (SBV) recently issued Circular No. 37 providing guidelines on bancassurance distribution transactions, particularly insurance agency operations by credit institutions and foreign bank branches ("banks") for insurance enterprises ("insurers"). Previously, bancassurance distribution arrangements between banks and life insurers were regulated by Joint Circular No. 86. Following the issuance of the new regulations on the insurance business for insurers under Circular No. 50 and Decree No. 73, Circular No. 37 was issued to replace Joint Circular No. 86 and clarify the rights and obligations of banks in regards to bancassurance arrangements. In regards to bancassurance deals, Vietnamese law regards banks as agents of the insurer and bancassurance distribution agreements as insurance agency agreements. Joint Circular No. 86 applied to bancassurance arrangements between banks and life insurers only. Circular No. 37 expands this governing scope to include general (non-life) insurance companies and re-insurance companies. Circular No. 37 takes effect from 2 March 2020 without clarifying any transitional mechanisms or the impact to bancassurance agreements executed before its effective date.

Brunei banks agree to defer repayments for select business sectors amidst COVID-19 outbreak Biz Brunei 20th Mar 2020
On March 19, the Brunei government and the banking industry have agreed to defer financing and loan repayments for up to six months for four sectors to help mitigate the financial impact of the COVID-19 outbreak. The deferment on principal repayments applies to businesses within the sectors of tourism, hospitality/event management, food and beverage (restaurant/cafes) and air transport as well as importers of food and medical supplies. Interest or profit rates still apply. The Second Finance and Economy Minister YB Dato Seri Setia Dr Hj Mohd Amin Liew made the announcement at a government-led press conference yesterday that updated that the COVID-19 outbreak in the Sultanate had increased to 73 cases. The minister said that the interim deferments – the first official state-led measures to alleviate financial burdens of Brunei businesses in the outbreak – were initiated by Brunei’s central bank Autoriti Monetari Brunei Darussalam (AMBD) with the support of the Ministry of Finance and Economy (MOFE) and the Brunei Association of Banks (BAB). The minister added that all bank fees and charges related to trade and payment transactions for companies in these sectors would be waived for six months. Local interbank transfer fees will also be waived for six months for all customers.

Six-month moratorium on bank loans, restructuring of credit card payments NST Online 25th Mar 2020
The government has announced a six-month moratorium on loan repayments and the restructuring of outstanding credit card balances involving about RM100 billion starting April 1. Prime Minister Tan Sri Muhyiddin Yassin said the move would ease the burden faced by small-medium enterprises (SMEs) and individuals as well as the corporate sector in facing the Covid-19 pandemic. After a series of discussions with the Finance Ministry and Bank Negara Malaysia, he said the government has agreed that banks would impose a six-month moratorium or postponement of repayments to individuals and SMES starting from April 1 this year. Meanwhile, credit card holders who are facing difficulties in paying their outstanding balances could opt for scheduled repayments between April 1 and Dec 31. Muhyiddin thanked the Finance Ministry, BNM and the banking industry in Malaysia for the move, estimated to involve about RM100 billion. Muhyiddin had on Monday announced a more comprehensive economic stimulus package and assistance for the people which would be announced on Mar 30. He said it would include medium-term efforts to strengthen the nation’s financial position, as well as necessary ways to provide assistance to all Malaysians.

Agrobank offers moratorium, restructuring of financing for SMEs The Edge Markets 20th Mar 2020
Agrobank has announced a raft of measures along with initiatives undertaken by Bank Negara Malaysia (BNM) to provide relief to small and medium enterprises (SMEs) hit by the COVID-19 pandemic. It said the measures are an immediate moratorium of up to six months for the monthly installment payments of financing to its existing customers and restructuring of their financing to help with their cash flow situation. Agrobank, through BNM’s Stimulus Package 2020, is also providing an RM2 billion Special Relief Facility (SRF) which will be deployed in the form of working capital to assist SMEs that are adversely impacted by COVID-19. Covering Covering president and chief executive officer Khadijah Iskandar said this facility is vital for SMEs in the agriculture and agrofood sectors to sustain their business operation and alleviate short-term cash flow problems.“Through this program, Agrobank will provide a prompt, collateral-free financing facility of up to RM1 million per SME with a competitive financing rate capped at 3.75 percent per annum,” she said. She said eligible SMEs can obtain the financing facility with Agrobank for a tenure of up to 5.5 years, including a six-month grace period. Another initiative taken under BNM’s Stimulus Package 2020 is the introduction of an RM1 billion Agrofood Facility and a RM300 million SME Automation and Digitalization Facility.
RAM: Slower loan growth seen for banking sector in 2020  The Edge Markets 6th Mar 2020
Banks in Malaysia are likely to clock in loan growth below that of 2019's 3.9% expansion this year, says RAM Rating Services Bhd. "Already having had to contend with the US-China trade tensions and anemic global growth, the global coronavirus (Covid-19) outbreak and domestic political uncertainties are expected to further constrict credit demand," its co-head of financial institution ratings Wong Yin Ching said in a statement on March 6. She noted that the Malaysian banking sector wrapped up 2019 with a muted 3.9% loan expansion, which was a multi-year low. Nevertheless, RAM noted that local banks declared higher dividend payouts during the fourth-quarter 2019 financial results against the backdrop of a cloudy outlook on loan growth and build-up of excess capital. The dividend payout ratios of domestic banking groups with financial years ending Dec 31 ranged from 29% to 88%, markedly higher than the 19% to 77% in the previous year. And banks’ capital positions are envisaged to remain solid after their dividend payments, it added. The domestic banking industry’s common equity tier-1 capital and total capital ratios stood at a relatively high 13.8% and 17.9%, respectively, as at end-December 2019 compared with 13.9% and 18.1% a year ago.  

BSP outlines additional relief measures for banks Business World 26th Mar 2020
The Central Bank is giving additional regulatory to financial institutions, including the imposition of a higher single borrower’s limit (SBL), removing penalties for reserve deficiencies, and providing leeway for some notification requirements amid disruptions caused by the coronavirus disease 2019 (COVID-19). First of the measures is the hike in big banks’ SBL to 30% from 25% for a period of six months. The Central Bank will also relax maximum penalty impositions for reserve deficiencies. They will also give banks some leeway in their notification requirements, such as in letting the Central Bank Luzon-wide enhanced community quarantine (ECQ).

E-Payments

Digital Banking Transactions Continue Surge In Philippines as Quarantine Enters Week 3 Fintech Singapore 30th Mar 2020
From the first three days of the enhanced community quarantine (ECQ), new enrollments in RCBC Online Banking continued to rise. The bank registered last Thursday, March 26, a new high of new enrolments in one day. The daily average of new signups post-ECQ, from March 17 to March 26, grew by 117 percent from the daily average pre-ECQ in the same month. Significant dips in signups are noted during the weekends. For transactions, the most growth was observed in the Cardless ATM Withdrawal function. A 633-percent increase in count and a 416-percent increase in throughput was recorded between pre- and post-ECQ figures in March. Send Cash transactions more than doubled in the same period. A 144-percent increase in count and a 44-percent increase in throughput was recorded between pre- and post- ECQ figures in March. Send Cash is a service available in RCBC Online Banking where clients can remit money to unbanked loved ones. The amount can then be withdrawn from any RCBC branch or ATM nationwide.

Grab and Gojek buck coronavirus; raise over $2bn combined  Gigabit 18th Mar 2020
Southeast Asian ‘super app’ Gojek has reportedly raised over $1bn in new funding. The Indonesia-based app, which provides service such as ride-hailing (where it originally got its start) payments and food delivery, operates throughout Southeast Asia, in countries such as Vietnam, Singapore, Thailand and the Philippines. According to Bloomberg, an internal memo from the company’s co-CEOs Andre Soelistyo and Kevin Aluwi read: “We’re not stopping there as we are still seeing strong demand among the investment community to partner with us. There are a number of exciting ongoing conversations that we will be able to update you on very soon.” In total, the company has now raised nearly $6bn from investors such as Tencent, Visa and Google. The company’s great regional rival Grab recently received a significant boost in funding of its own, revealing an over $850mn round from Japanese investors including Mitsubishi UFJ Financial Group and TIS. The round was explicitly intended to bolster the super app’s financial services. In the press release, Grab’s president Ming Maa said: “We are excited to work with our partners MUFG and TIS to co-develop financial products and solutions for the region. Ensuring greater access to affordable and accessible financial services and products is key to growing financial inclusion in Southeast Asia. The continued support from world-leading investors demonstrates their confidence in Grab’s super app strategy and our ability to build a sustainable long-term business.” Speculation had been mounting regarding a possible merger between the two, though that seems less likely now due to their mutually strengthened financial positions and uncertainty in the global economy prompted by coronavirus.

Wing hosts delegation to showcase latest e-payment facilities Khmer Times 16th Mar 2020
Wing (Cambodia) Limited Specialized Bank recently hosted a special Government tour of its headquarters in Phnom Penh, demonstrating its facilities for mobile money and electronic payment services. The tour was led by the Chairman of Wing, Neak Oknha Kith Meng and Tram Iv Tek, Minister of Posts and Telecommunications (MPTC), who was accompanied by a 17-strong member delegation of senior ministry officials. The delegates were shown how Wing uses cutting-edge technology in the operation of digital payment solutions to enable e-commerce and e-governance to support the Royal Government of Cambodia’s initiative for developing the Kingdom’s digital economy. Besides providing basic services like money transfer, bill payment, phone top ups, online and offline payments, Wing also offers outbound and inbound money transfer services to over 200 countries through its international money transfer partners. Looking to the future, Wing has been working to support Tinh Tinh, as an e-commerce platform payment gateway designed to ease online shopping nationwide. Currently, Wing agents are already attached to 28 post offices around Cambodia.

Wirecard and Southeast Asia Super App Grab Announce Payments Partnership to Drive Cashless Economy for MSMEs Across the Region The Fintech Times 13th Mar 2020
Wirecard, the global innovation leader for digital financial technology, is entering into a payments partnership with Grab, Southeast Asia’s leading super app, that will see Wirecard process transactions made via the GrabPay e-wallet, starting with the Malaysian, the Philippines and the Singapore markets. Consumers can use their GrabPay e-wallet to pay for transactions online and offline, for example, for ride-hailing or food delivery, but can also use it to pay for purchases on e-commerce sites or at physical stores. Through this partnership, Wirecard will process card transactions for GrabPay via its digital financial commerce platform and will extend GrabPay to more merchants to expand the acceptance of the mobile payment method. According to a recent global Wirecard consumer survey, over 90% of consumers in Southeast Asia have used digital payments both in-store and online. Mobile wallets are almost twice as popular in the region as they are worldwide, with 44% regularly choosing them as a payment method compared to the global average of 25%. The GrabPay e-wallet is one of the most popular e-wallets in Southeast Asia accepted by over 600,000 merchants and small businesses.

Banking on a cashless future The Myanmar Times 12th Mar 2020
In a joint statement after President U Win Myint’s meeting with Indian Prime Minister Narendra Modi, a digital payment channel was set up using India’s RuPay card scheme in Myanmar. Since the agreement, interest in Myanmar’s digital payment system has grown. U Zaw Lin Htut, chief executive officer of the Myanmar Payment Union (MPU), talks about the challenges facing the country’s transition to online payments.

Australia inks digital economy pact with Singapore ComputerWeekly.com 25th Mar 2020
Australia has inked a digital economy agreement with Singapore that is expected to open new digital trade opportunities for businesses and consumers in the two countries. Through the pact, the transfer of data between Australia and Singapore for business purposes, including in the financial sector, will be allowed. This will help businesses remain competitive by gaining access to useful market intelligence, identifying growth opportunities, designing innovative goods and services, improving pricing and operating more efficiently.

Insurance

FWD Philippines adopts digital underwriting engine Insurance Business 27th Mar 2020
FWD Philippines has adopted a digital underwriting solution based on the Underwriting Rules Engine (URE) created by UnderwriteMe, a subsidiary of Pacific Life Re. According to a statement by Pacific Life Re, the solution is a first of its kind in the Philippine market, and will result in a much shorter application process, minimizing the review time needed to provide an underwriting decision at the point of sale. This, the company claimed, will improve the experience for both agents and customers. It follows recent successful implementations by UnderwriteMe for FWD in Singapore and Malaysia. Implementation plans for FWD’s other markets across Asia are in process, the statement said.

General insurance premiums rise 8% in Singapore Business Insurance 27th Mar 2020
The General Insurance Association of Singapore has said that the sector's gross written premiums grew nearly 8% year-over-year to more than $4 billion Singapore ($2.8 billion) in 2019, Asia Insurance Review reported. The general insurance industry reported an underwriting loss of SGD 28 million last year, compared with a profit of SGD 36 million in 2018.

Covid-19: Insurance policy holders can undergo screenings in private hospitals Malay Mail 27th Mar 2020
Malaysians with insurance and takaful (syariah compliant) policies can now go for the Covid-19 screening test at any of the country’s private medical facilities. Health director-general Datuk Dr Noor Hisham Abdullah said the announcement made by Prime Minister Tan Sri Muhyiddin Yassin today for the insurance and takaful industry to cover the cost of screening tests would surely ease the burden of the Ministry of Health (MOH). Through the package, the insurance industry created a special fund of RM8 million to cover screening costs of up to RM300 for each policy and medical takaful certificate holder directed by MOH to undergo testing at a private medical facility. The prime minister today also announced that in appreciation of the sacrifices of doctors, nurses and healthcare workers, the government would increase their special allowance from RM400 to RM600 a month from April 1 until the Covid-19 situation improved.

Oldest Indonesian Bank Draws Bidders in Revived Unit Stake Sale Bloomberg.com 26th Mar 2020
PT Bank Rakyat Indonesia has revived its plan to sell a stake in its life insurance arm, which is attracting interest from suitors in a deal that could fetch about $500 million, according to people familiar with the matter. FWD Group Ltd., backed by Hong Kong billionaire Richard Li, and BNP Paribas Cardif SA are among potential bidders for a significant minority stake in PT Asuransi BRI Life, the people said. Prudential Plc and Samsung Life Insurance Co. are also weighing offers for the business, said the people, who asked not to be identified as the discussions are private. A transaction could also involve a so-called bancassurance partnership, which allows an insurer to sell its products through the bank’s branches, the people said. The state-owned lender has requested binding bids as early as next month, although the coronavirus outbreak could delay the process, the people said. Shares of Bank Rakyat Indonesia soared as much as 25% on March 27 in Jakarta. The stock was up 14.6% as of 9:36 a.m. local time, while the country’s benchmark index climbed 4.9%. Deliberations are ongoing and the companies could still decide against pursuing a transaction, the people said. Representatives for Bank Rakyat Indonesia, Cardif, FWD, Prudential and Samsung Life declined to comment.

Prudential buys exclusive rights to sell insurance via Thai bank Nikkei Asian Review 19th Mar 2020
British insurer Prudential said it has reached an exclusive deal to sell life insurance products through TMB Bank, Thailand's sixth largest lender. The 24.5-billion-baht ($750 million) deal was signed between Prudential and Hong Kong's FWD Group Financial Services. The British insurer will pay 12 billion baht by April, and the remainder on Jan. 1, 2021. The initial term for the exclusive rights will start on Jan. 1 and last for 15 years. The parties agreed to set April to December 2020 as the transition period. TMB Bank will continue selling FWD bancassurance products, while onboarding Prudential's products. Prudential already has an exclusive bancassurance selling deal with Thanachart Bank, which is in the process of merging with TMB Bank. The entire consolidation is expected to be completed by mid-2021. The merged bank will still be the sixth largest after Bank of Ayudhya, a Thai subsidiary of Japan's Mitsubishi-UFJ Financial Group. Its fourth largest branch network will help Prudential reach more customers in Southeast Asia's second largest life insurance market. The deal will further strengthen ties between TMB Bank, Thanachart Bank and Prudential, as the British insurer has already teamed up with TMB Bank in asset management.

AIA Singapore to provide 50,000 video medical consultations for its HealthShield Gold Max policyholders MobiHealthNews 17th Mar 2020
AIA Singapore, which is part of the largest public listed pan-Asian life insurance group, announced that will cover the costs of 50,000 video medical consultations provided by WhiteCoat, a Singapore-based tele-medicine provider for all its HealthShield Gold Max policyholders. Individuals who require professional medical advice can engage WhiteCoat's Singapore-registered doctors from the comfort of their own home, exclusively via the AIA Healthcare App. After 50,000 video medical consultations have been utilized by AIA HealthShield Gold Max policyholders in Singapore, they can continue to engage WhiteCoat's services at a pre-negotiated rate of S$12 per consultation. The insurance company also said that it will include the extension of claims pre-authorization to cover all non-emergency admissions and day surgeries at all private hospitals and healthcare providers across Singapore for its HealthShield Gold Max policyholders, effective 15 April 2020.

Malaysian Life insurance industry registers healthy growth in 2019 The Star Online 17th Mar 2020
New business total premiums for life insurance rose by 14.19% to RM11.8bil last year compared with RM10.3bil in 2018, according to the Life Insurance Association of Malaysia (LIAM). Traditional business, investment-linked and group business recorded strong growth at 30.12%, 11.05% and 10.79% respectively. New policies issued in 2019 recorded an increase of 6.22% from 1,238,249 policies in 2018 to 1,315,233 policies (2019). Investment-linked policies continued to be a popular product last year. LIAM added that new business sum assured increased by 6.91% to RM483.4bil in 2019 compared with RM452.1bil the previous year. The total number of policies registered for the whole industry rose marginally at 0.60% from 12.67 million policies in 2018 to 12.74 million policies in 2019. The number of lives covered under group policies grew by 1% to almost 10.2 million lives as compared to 10.1 million lives in 2018. The total sum assured in force increased to over RM1.63 trillion, an increase of 7.83% as compared to RM1.51 trillion in 2018. The total claims payout increased by 10.19% to RM11.9bil as compared with RM10.8bil in 2018. On the outlook for 2020, given the uncertainties faced by the global and local economies partly due to the COVID-19 outbreak, counter-balanced by the strong resilience of life insurance industry and the low insurance penetration rate in Malaysia, it is expected that the industry will achieve a high single-digit growth, LIAM noted.

Hong Kong's AMTD Digital to acquire Singapore insurtech startup PolicyPal TechinAsia 17th Mar 2020
AMTD Digital, the digital finance arm of Hong Kong-based AMTD Group, announced that it will acquire a controlling stake in PolicyPal, an insurtech company with a digital insurance broker license from the Monetary Authority of Singapore (MAS). The deal, valued at more than US$20 million, is yet to be approved by MAS, PolicyPal founder and CEO Val Yap told Tech in Asia. After the deal closes, AMTD Digital will have a 51% stake in PolicyPal, a mix of cash and equity, Yap said. Yap will continue to lead PolicyPal as CEO. The startup will also become a member company under AMTD Digital, acting as its operating vehicle to develop and expand in the Southeast Asian insurtech sector, the announcement said. PolicyPal will also collaborate with AMTD’s insurance brokerage company, AMTD Risk Solution, to promote online insurance services and risk management experience. Last year, AMTD Group, together with Chinese electronics company Xiaomi, established Airstar Bank and obtained a virtual banking license from the Hong Kong Monetary Authority. It has also teamed up with SP Group, Xiaomi, and Funding Societies to jointly apply for the Singapore digital wholesale banking license. AMTD Group said Singapore, which serves as the company’s regional headquarters, is an important hub for Southeast Asia’s fintech space. The deal with PolicyPal marks an important milestone for AMTD as it further invests in the city-state and the region’s fintech industry, the statement said.

Leading Malaysian insurer to bring “Fast & Easy” insurance to the local market Khmer Times 11th Mar 2020
Malaysia’s leading Insurance and Takaful Company Etiqa has started operations in Cambodia, allowing the local people to experience a fast and easy way to get insured. Etiqa has entered the Kingdom upon seeing the vast potential the local market has to offer, with 97% of the Cambodian population currently uninsured. Etiqa will offer fire insurance, both retail and commercial, and personal accidents cover via the 21 Maybank branches located across Cambodia. Looking toward the future Etiqa is also planning to offer endowment, term, education, and investment-linked, medical, motor, travel, marine and engineering insurance. The insurance sector in Cambodia has experienced tremendous growth over the last five years with total premiums increasing on average 35 percent a year over the period.

Indonesia court revokes health insurance premium hikes InternationalInvestment 10th Mar 2020
Indonesia's Supreme Court has annulled a presidential regulation issued last year that had doubled the tiered premiums on the national health insurance, a court spokesman said. The government issued a decree to raise premiums managed by insurer BPJS Kesehatan by at least 65% in October, after the state-owned agency estimated a $2.3bn cash shortfall last year and warned that the gap could widen by 140% by 2024. The deficit has caused delays in payment to various medical service providers. State-owned BPJS Kesehatan, which provides universal health cover, has been in financial trouble for several years, citing more payouts than premiums collected. The Supreme Court argued that according to the 2004 Social Security Law and 2011 Social Security Agency Law, the national health insurance premium has to be at a level that matches Indonesia's economic development and also takes into account the needs of the people. Doubling the premium during a time of stable inflation and slow economic growth would be going against the needs of the people, the judges argued. Finance minister Sri Mulyani Indrawati said the ruling would have implications on BPJS Kesehatan's finances. A group of patients suffering from kidney failure petitioned the court to review the decree that increased premiums, according to a report by Reuters that cited Indonesian-language news portal Detik.com. It's not clear if BPJS Kesehatan will have to return funds to policyholders or the state following the ruling. The government pays for the coverage of some 96 million people on low income.

Aviva announces exit, sells entire stake in Indonesian joint venture The Jakarta Post 9th Mar 2020
British insurance company Aviva Holding Ltd. has announced its exit from Indonesia, selling all its shares in its joint venture in the country, PT Astra Aviva Life (Astra Life), to its partner, PT Astra International. Aviva released the statement on the company’s website on March 6. The shareholders of Bangkok Bank approved the acquisition of Permata Bank on March 5. Bangkok Bank announced in December that it had agreed to buy 89.1 percent of stakes in publicly listed Bank Permata from Standard Chartered and Astra International for around US$2.67 billion as part of its overseas expansion. British financial giant Standard Chartered and Indonesian diversified conglomerate PT Astra International were the majority owners of Bank Permata shares, each owning 44.56 percent. Astra Life was established on May 26, 2014, and by 2018 it had over 750 employees and provided services to over 1.4 million customers, according to information on the company’s website. The company had total assets amounting to Rp 5.9 trillion (US$407 million) in the fourth quarter of 2019, a Rp 900 billion year-on-year growth, according to its financial statement.

Insurance companies, takaful operators review operating hours during MCO The Edge Markets 23rd Mar 2020
Insurance companies and Takaful operators have reviewed the opening hours of their branch offices nationwide in support of the government’s effort to curb the spread of Covid-19 during the Movement Control Order (MCO) from March 18-31, 2020. Some companies are temporarily closing the operation of their branch offices, while some have shortened their opening hours, the Life Insurance Association of Malaysia (LIAM), Persatuan Insurans Am Malaysia (PIAM) and Malaysian Takaful Association (MTA) said in a joint statement on March 23. The three associations also strongly encouraged policyholders or certificate holders, as well as the public to communicate with the insurance companies or Takaful operators through digital platforms, to minimize face-to-face interaction during this period.

Covid-19 poses no immediate downside earning risks to insurance industry The Malaysian Reserve 6th Mar 2020
The Covid-19 outbreak could present an opportunity for insurers to boost healthcare policy sales instead of having a negative impact on earnings according to industry players. As the infection levels remain low, at 55 (at press time), the domestic insurance sector’s earnings are expected to remain stable, analysts believe but industry insiders see a potential opportunity. “After the SARS crisis in 2003, the health and insurance market in Malaysia grew by 35%. It was the trigger point that created sensitivity among people thinking they need to invest to protect their health,” said Allianz Life Insurance CEO Joseph Gross. While it will be too optimistic to expect such exponential growth of more than 30% across the insurance industry, Gross does not anticipate an immediate negative impact on insurers’ balance sheet either. MIDF Amanah Investment Bank Bhd (MIDF Research) analyst Khoo Zhen Ye agreed the widespread transmission of the virus which originated from Wuhan, China, will most likely trigger demand for health and medical coverage, especially with insurance providers offering extra protection for hospitalization that covers compounding expenses incurred during treatment. Khoo added that the travel restrictions announced by several countries in the effort to contain transmission, dampen the demand for travel insurance. However, the overall insurance sector will still be mainly supported by the sustained growth coming from the life insurance and family takaful segments.

Market Regulation

20m register for financial aid Bangkok Post 30th Mar 2020
Almost 20 million people registered for Covid-19 financial aid in Thailand in less than 48 hours, almost seven times the number estimated by authorities. Some 19.8 million have registered as of 2pm on March 30, the Finance Ministry announced on its Facebook.  The handout — at 5,000 baht per person per month for three months from April — is intended for about 3 million temporary employees, contract employees and self-employed individuals who are not covered by the social security system, Deputy Prime Minister Somkid Jatusripitak said earlier. Finance Minister Uttama Savanayana said on Monday approved applicants are those affected by the impacts of the coronavirus outbreak, especially temporary or self-employed workers, as well as those who were laid off, saw their working hours or salaries cut, or those whose places of work were closed by government orders. Despite the high number, registration remains open to ensure all affected workers have access to the relief, Mr Uttama said. He warned that a successful registration is not a guarantee the person will get the benefits. If all the applications as of Monday are approved, the government will need almost 300 billion baht. It is unclear at the moment where the budget will come from. But Mr Somkid said earlier an emergency borrowing could be made since there was still room for it. Thailand's public debt is at 41.3% of gross domestic product and the revised ceiling is 60%.

NBC issues licence to SBI Lyhour Bank Plc The Phnom Penh Post 30th Mar 2020
SBI Lyhour Bank Plc, a subsidiary of Japanese internet banking giant SBI Holdings Inc, was awarded an official license by the National Bank of Cambodia (NBC) to operate in the Kingdom. Last year, SBI Holdings purchased a 70 per cent stake in Cambodian-based Ly Hour Microfinance Institution Plc for $81.7 million, which transformed the latter into the full-fledged commercial bank SBI Lyhour Bank. SBI Lyhour Bank is headquartered in Tuol Kork district’s Boeung Kak II commune in the capital. The license – signed by NBC governor Chea Chanto on March 23 – binds the bank to the Law on Banking and Financial Institutions as well as all regulations, circulars and conditions issued by the NBC. SBI Holdings said it plans to expand its operations in all of the Kingdom’s provinces with retail and small and medium-sized enterprises as its target clients. In 2008, SBI Holdings founded Phnom Penh Commercial Bank (PPCBank) in a joint venture with South Korea’s Hyundai Swiss Financial Group Inc – led by Hyundai Swiss Savings Bank Inc – which was a predecessor to SBI Holding’s South Korean subsidiary SBI Savings Bank Inc.

NBC’s directive to restructure credit targeting four sectors The Phnom Penh Post 30th Mar 2020
The National Bank of Cambodia (NBC) on March 27 issued a directive to all banks and financial institutions to restructure credit for loans in four priority sectors, a move lauded by the private sector. The directive aims to maintain financial stability, support economic activity and ease the burden of debtors facing declining revenues during the ongoing Covid-19 outbreak. The four priority sectors cited by the NBC were tourism (including food and beverage, as well as other support services), garments (including employees), construction (exclusively for first house purchasers, shops and first mortgages) and transport (especially taxi drivers and tuk-tuk drivers) and logistics. The NBC defined “credit restructuring” as an amendment to the terms of the original credit agreement, which provides more favorable conditions for clients who are experiencing real financial difficulties. The directive also recommends banks and financial institutions to verify that clients are struggling financially before restructuring their loans.

BSP eases banks' forex trading rules Inquirer.net 30th Mar 2020
In another response to the coronavirus pandemic, the central bank of the Philippines on Friday said it was providing additional relief measures for the foreign exchange market to facilitate financial transactions during the ongoing Luzon-wide lockdown period. In a statement, Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno said the policy-making Monetary Board approved new operational guidelines for transactions in the peso-dollar market in line with the declaration of “community quarantine” by the Office of the President. The approved measures mainly involve the electronic submission of documents for applications for approval or registration of foreign currency loans; borrowings or investments, and the sale of foreign exchange by authorized agent banks or forex corporations. The relaxed rules also allow the use of e-signatures or digital signatures for documents originally required to be submitted in hardcopy or those requiring signatures; allowing the submission of documents without the e-signatures, digital signatures or the required notarization and the nonimposition of monetary penalties for delayed submission of reports. The central bank said it has also decided to relax the deadline or prescriptive periods for the submission of certain documents, information or applications covering foreign currency loans, borrowings or investments. It also announced a waiver of applicable processing fees for applications covering private sector foreign currency loans or borrowings with foreign currency obligations due within the period covered by the relaxed rules as well as the issuance of BSP documents by the central bank’s International Operations Department in electronic form.

First time in history: Shorter trading hours for Indonesian stocks amid COVID-19 The Jakarta Post 27th Mar 2020
The Indonesia Stock Exchange (IDX) is shortening trading hours starting March 30 to adjust to shorter bank settlement hours and the work-from-home policy implemented on account of COVID-19, potentially resulting in lower trading value in light of high volatility. Stock trading hours will be shortened to four hours from five-and-a-half hours previously, according to an IDX announcement. The bourse will open as usual at 9 a.m. Jakarta time, but close trading one hour earlier at 3 p.m. The lunch break is also extended by half-an-hour to two hours between 11:30 a.m. and 1:30 p.m. from Monday to Friday. The policy will come into effect on Monday, March 30. Budi added that it was the first time in history that the IDX had made such a move. With the new hours, the JCI could have more stable movement as investors would have less time to sell their stocks amid the pandemic panic, said Budi. Stock trading at the IDX hit circuit breakers five times this month as investors exited risky investments including stocks over fears of a COVID-19-driven global recession.

Banks Reworking AGM Plans Around Gathering Limits finews.asia 26th Mar 2020
Banks and other financial institutions are scrambling to adapt to the Singapore government's latest limit on gathering size, especially for those that have arranged for physical annual general meetings (AGMs) which would happen soon. With its AGM less than one week away on March 31, DBS posted an update on Tuesday night about possible changes in the arrangement for its meeting after the government announcement. The bank had initially planned for shareholders who want to attend the meeting at Marina Bay Sands Expo and Convention Centre to pre-register online. The Accounting and Corporate Regulatory Authority (Acra) and the Monetary Authority of Singapore (MAS) on March 25 said they are working to propose legislative amendments on meetings so as to adhere to safe distancing rules amid the novel coronavirus outbreak. United Overseas Bank, which usually attracts a large turnout at its AGMs, said it is reviewing the arrangements for its upcoming meeting on April 30. «Our measures, which will include a live webcast of the AGM, will be aligned to the guidance from the government and our regulators. We will share more details in due course,» a spokesperson said.  

Jokowi relaxes loan settlements to help small businesses cope with COVID-19 effects The Jakarta Post 25th Mar 2020
The Financial Services Authority (OJK) will extend loan payment deadlines for micro, small and medium enterprises (MSMEs) for up to one year to help them cope with the economic impacts of the COVID-19 pandemic. Speaking at the State Palace in Central Jakarta on March 24, President Joko "Jokowi" Widodo said the new relaxation would apply to business loans worth up to Rp 10 billion (US$619,118), both from banks and non-bank institutions. He added that creditors were prohibited from demanding loan installments, especially through debt collection services, and also called on the police not to enforce such collections. The new relaxation could help MSMEs survive the pandemic, which has dealt a hard blow to Indonesia's economy. MSME Association (Akumindo) chairman Ikhsan Ingratubun estimated earlier this month that MSME sales revenue had dropped 30 to 35 percent across Indonesia from February until March 9. He predicted that the sector would continue to feel the impact of COVID-19 for the next three months. The government has already deployed two stimulus packages worth Rp 22.9 trillion and Rp 10.3 trillion, which include individual and corporate tax breaks and the relaxation of loan disbursements and restructuring requirements.

Central bank delays foreign ownership cap in payment services industry vietnamnews.vn 23rd Mar 2020
The State Bank of Việt Nam has said it will not cap foreign ownership of companies in the payment services industry in its draft decree to replace Decree No.101. It had spoken about plans to bring in a foreign ownership limit of 49 per cent on an industry that currently has no restrictions to avoid manipulation by foreign investors. Decree No.101 allows payment service providers, including foreign ones, to freely raise capital to develop their business.

Finance ministry to reduce some securities service fees vietnamnews.vn 19th Mar 2020
The Ministry of Finance has approved a plan to reduce the fees for some types of securities-related services this week to support market members and investors badly impacted by the COVID-19 pandemic. According to the Chairman of the State Securities Commission Trần Văn Dũng, the move aims to stabilise investors’ psychology, soothe the roiled market and ensure social security amidst the pandemic. "Under the plan, fees for four types of services on the derivative securities market at the Vietnam Securities Depository will be cut to a more reasonable level," said Dũng

Ministry makes int’l accounting rules compulsory after 2025 vietnamnews.vn 18th Mar 2020
The Ministry of Finance on Monday issued a decision regulating the roadmap for the application of International Financial Reporting Standards (IFRS), replacing the current Vietnamese accounting standards (VAS). Under the Decision 345/QĐ-BTC on the development of plans, roadmaps and support the application of IFRS, the roadmap for adopting IFRS in Việt Nam would be divided into phases – from 2022 to 2025 and after 2025. In the first phase, the adoption of IFRS would be encouraged. It could be adopted by certain subjected companies which were capable of making financial reports following international accounting rules or selected by the Ministry of Finance for pilot implementation.

BIBD urges public to use digital, cashless services Borneo Bulletin 28th Mar 2020
BIBD is rallying the public with Go! campaign to encourage customers to Go Cashless or Go Digital and promote the habits of doing banking needs on the digital platforms. As the country heeds the Ministry of Health’s call to practice physical distancing amid the COVID-19 outbreak, BIBD urged customers to take advantage of the digital and cashless services available under the BIBD NEXGEN banner. Customers can Go Digital by paying their bills from a list of over 70 payees (from individual needs to corporate needs including TAP payments), purchase e-Credits, top up their electricity and prepaid mobile credits. Customers can use BIBD’s contactless debit and credit cards, as well as BIBD QuickPay – a form of payment using QR code that is currently accepted by over 450 merchants.

Traffic compound payments go online Borneo Bulletin 11th Mar 2020
The Royal Brunei Police Force (RBPF) through its Investigation and Traffic Control Department (JSKLL) has collaborated with Bank Islam Brunei Darussalam (BIBD) to provide online payment to facilitate the public in paying their traffic offence compound. This was announced on March 11 by Acting Director of JSKLL Pengiran Haji Abdul Salam bin Pengiran Haji Abdul Ghani, who pointed out this collaboration is a service innovation introduced by RBPF. Senior Manager at BIBD Corporate Banking Group Pengiran Sanusi Iskandar bin Pengiran Haji Ismail briefed the media on the guidelines and regulation when using the system. He said the service is available for BIBD account holders through BIBD online Bill Payment, BIBD BizNet and Progresif Pay. He added this service facilitate the users themselves, aside from providing a flexible payment system by following four-payment steps. Pengiran Haji Abdul Salam said information leaflets about the service will be distributed to the public. Payments of traffic compound using credit and debit cards will also be introduced in the future.

All PLUS, LPT2 Highways will operate RFID lanes from April 1 The Edge Markets 11th Mar 2020
From April 1, PLUS-operated highway users will be able to use the Touch ‘n Go Radio Frequency Identification (RFID) payment facility at all its 83 closed toll systems in the country. PLUS Malaysia Berhad managing director Datuk Azman Ismail said the RFID service will also be available on the East Coast Highway 2 (LPT2). In a statement on March 11, Azman said the implementation of RFID on these highways is in line with the Government’s vision of a Multi-Lane Free-Flow (MLFF) which offers cashless toll transaction and ensure smooth traffic movement at all toll plazas. He said effective April 1, there will be a total of 173 RFID lanes in operation, including 131 dedicated specifically to RFID lanes at 83 toll plazas on Plus expressway. Meanwhile, Azman said toll transactions using Touch 'n Go and SmartTAG will still be accepted at the toll plazas to provide time for the road users to switch to RFID. Azman said that the past 36 months had enabled PLUS to harmonise the RFID system with Touch N Go and by April 2020, the entire PLUS highway (both Open Toll and Close Toll systems) will accept payment via RFID.

Financial markets allowed to operate during lockdown Business World 23rd Mar 2020
The government has allowed financial markets to operate with a skeletal workforce during the month-long lockdown of the main island of Luzon. The presidential palace released additional guidelines on the lockdown from an inter-agency task force, saying the central bank, Securities and Exchange Commission and Philippine Stock Exchange may operate starting March 1.