The current situation around financial wellbeing in Southeast Asia
Asia Pacific is emerging as one of the top destinations for digital banking globally. Of around 250 digital banks worldwide, 20% operate in Asia Pacific.
One of the challenges faced by many of the digital banks is addressing the segment of the population who have not historically had high levels of access to financial services. This is brought to light through recent studies which indicate that some Southeast Asian countries have the lowest financial literacy scores globally.
Financial literacy is defined by Investopedia as “the ability to understand and effectively use various financial skills, such as personal financial management, budgeting and investment”. The growing need to improve this literacy has caused a surge in digital banking providers, offering new ways for people to learn and navigate the financial world.
This is one of the reasons why the retail banking sector in Asia is putting the spotlight on the increased consumer demand for wealth management. The biggest obstacle, however, to implementing such practices is being able to access financial services in the first place, with approximately 50% of South East Asia being ‘unbanked’ and a further 24% said to be ‘underbanked’.
The statistics above clearly show that financial wellbeing in the Asia Pacific region is an area deserving of focus and why banks and Fintechs implement a range of digital features to help combat the situation. Examples include bill payment schedules, spending analysis, automated savings, retirement planning, and many others. It will be interesting to see how this trend unfolds throughout 2022.
How can Transaction Data Enrichment help
Hugo, one of our customers in Singapore, recently launched a digital account focused on ‘Wealthcare’. The finance app seeks to provide customers within the Asia Pacific region with clarity on their card spending to build a thriving, financially healthy community. Hugo partnered with Snowdrop to enrich ambiguous transaction information in order to provide a better user experience for consumers.
With Hugo, users can save, invest, track spendings and investments from the comfort of their homes. This encourages users to develop healthy financial habits and savings plans for faster wealth growth and prosperity.
The banking and financial services landscape has seen dramatic changes over the last couple of years. The digitally savvy customers are obsessed with efficiency, transparency, and simplicity in banking operations. A growing number of Fintechs, traditional, and digital banking platforms are employing API solutions like Snowdrop’s Merchant Reconciliation System (MRS) to enable them to offer that excellent consumer banking experience.
MRS transforms messy customer transactions into enriched information that is easy for the users to interpret and comprehend. When customers understand their spending and saving data better, it removes doubt and suspicion that they may have in dealing with the financial service provider. This helps to create a fantastic user experience and build trust.
What will happen next?
Banks are working hard to expand their presence and strengthen their wealth management services. WealthTech firms and Fintech giants are striving to stake their claim, and the competition to get the lion’s share of the region’s financial wealth management is fierce.
In 2022, financial service providers will need to combine human ingenuity and technological innovation for sustained financial outcomes. The winners will be those institutions that understand that the future of wealth management lies in stewardship that meets end-user demands with top-tier service for customer satisfaction.
Want to know more?
Snowdrop Solutions currently works with leading digital and traditional banks in Europe, the UK and Asia Pacific. Snowdrop is a location and data intelligence company that has been a Google Trusted Partner since 2013 and Visa Europe since 2020. MRS brings together our deep understanding of the Google Maps APIs, a proprietary database and a second to none matching algorithm. We offer superior match rates and accuracy to any of our competitors and a unique customer centric approach that, other than transaction enrichment, provides cost savings and churn reduction to our clients, over and over.
If you want to know more about our product, you can access more information on our dedicated MRS page or by contacting us. A member of the team will respond to your request promptly.