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Fintech 2018: the Asia Pacific Edition FINTECH 2018 THE ASIA PACIFIC EDITION ©2018 CFA Institute. All rights reserved. 1 FINTECH 2018 THE ASIA PACIFIC EDITION © 2018 CFA Institute. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or any information storage and retrieval system, without permission of the copyright holder. Requests for permission to make copies of any part of the work should be mailed to: Copyright Permissions, CFA Institute, 915 East High Street, Charlottesville, Virginia 22902. CFA®, Chartered Financial Analyst®, CIPM®, Investment Foundations™, and GIPS® are just a few of the trademarks owned by CFA Institute. To view a list of CFA Institute trademarks and the Guide for the Use of CFA Institute Marks, please visit our website at www.cfainstitute.org. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is provided with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If professional advice or other expert assistance is required, the services of a competent professional should be sought. September 2018 What will be the most interesting trends on Fintech going forward? This Fintech report provides insight, analysis and identifies trends on developments in blockchain, artificial intelligence and more. It is a comprehensive study designed to inform people in the industry about upcoming trends, and help them better understand and manage the issues, opportunities, and challenges ahead. Nick Pollard, Managing Director, Asia Pacific, CFA Institute Acknowledgement In addition to the experts who contributed to this volume and spoke at our events, many colleagues at CFA Institute on both sides of the Pacific have worked tirelessly to make this happen. I would like to thank specifically Rob Gowen, Rhodri Preece, Brenda Hou, Oscar Tai, Joseph Wong, and Joyce Chan for their support. Nick Pollard kindly provided an endorsement for this volume. Go team! iv www.cfainstitute.org CONTENTS Author Bios .............................................................................................................................................. vii Preface ..................................................................................................................................................... x Introduction ............................................................................................................................................ xi I. Overview The Roadmap for FinTech Development ........................................................................................... 2 The Future of FinTech in Banking ...................................................................................................... 5 Why Robo-Advisers Are on the Rise in Asia ..................................................................................... 9 Future Trends in Insurtech ................................................................................................................... 11 The Regtech Start-Up Eco-System .................................................................................................... 14 II. AI/Blockchain Artificial Intelligence, Machine Learning, and Deep Learning: A Primer .................................... 17 Portfolio Managers, AI Is Coming for Your Jobs ............................................................................... 20 Artificial Intelligence and the Future of Investment Management ............................................ 23 Artificial Intelligence: Unlimited Possibility ..................................................................................... 25 Artificial Intelligence Leads the Future of Personalized Asset Management.......................... 27 China's Financial Industry Is Moving from Digitalization to Intelligence ................................. 29 Blockchain Application in Financial Services ................................................................................ 31 Blockchain: A Progress Report ........................................................................................................... 34 III. MARKETS AUSTRALIA ................................................................................................................................................ 39 Alternative Lending Takes Lead in Australia's FinTech Business ................................................ 40 Is Micro-Investing What Works for Robo-Advice in Australia? ................................................... 42 The In-House Alternative to FinTech: The NAB Case ...................................................................... 45 CHINA ........................................................................................................................................................ 48 Technology Options for China's Small and Medium Banks ......................................................... 49 How the ABCD of FinTech Is Changing Financial Services in China ........................................... 52 ©2018 CFA Institute. All rights reserved. v HONG KONG SAR ...................................................................................................................................... 54 HKMA Perspectives and Policy Stands on FinTech ........................................................................ 55 2018 FinTech Start-Up Scene in Hong Kong ..................................................................................... 59 INDIA .......................................................................................................................................................... 62 Demystifying FinTech in India ............................................................................................................. 63 The FinTech Landscape in India: From Payments to Alternative Lending ................................. 69 HDFC's Approach to FinTech ................................................................................................................ 72 P2P Lending—A Definitive Checklist .................................................................................................. 74 JAPAN ........................................................................................................................................................ 77 Japan FinTech: Crypto-Currency Exchange, Alternative Lending and More ............................. 78 SINGAPORE ............................................................................................................................................... 81 MAS Perspective on AI, Blockchain, and Regulating FinTech ..................................................... 82 Banking and FinTech: The Singaporean Approach ......................................................................... 86 THAILAND .................................................................................................................................................. 89 Thailand FinTech Review ..................................................................................................................... 90 vi www.cfainstitute.org ABOUT THE AUTHORS JANOS BARBERIS Founder, SuperCharger and FinTech HK Janos Barberis is recognized as a top-35 global FinTech leader by Institutional Investor Magazine. His expertise is focused on the new regulatory considerations raised by the development of FinTech. Mr. Barberis has founded three ventures to date: SuperCharger (accelerator), The FINTECH Book (publication), and FinTech HK (research). He sits on the FinTech advisory boards of the World Economic Forum and the Securities & Futures Commission. Mr. Barberis is a PhD candidate at the University of Hong Kong. LARRY CAO, CFA Director, Industry Research, CFA Institute Larry Cao, CFA, conducts and manage original research projects for CFA Institute, with a focus on the investment industry. Prior to joining CFA Institute, he worked at HSBC as a senior manager for the Asia Pacific region. He started his career at the People's Bank of China as a USD fixed-income portfolio manager. He worked for over 10 years in the U.S., managing equity portfolios for Munder Capital Management and multi-asset investment programs for top-tier global financial institutions at Morningstar/ Ibbotson Associates. Mr. Cao has been interviewed by a wide range of business media, including Bloomberg, the Financial Times, South China Morning Post, and Wall Street Journal. He led the development of the CFA Institute report FinTech 2017: China, Asia, and Beyond and is a frequent speaker at industry conferences. Mr. Cao holds an MBA from the University of Notre Dame. BRANDON CHUNG Project Manager, SuperCharger Brandon Chung graduated with a bachelor's degree in business administration and management from Warwick Business School. Prior to joining SuperCharger, he worked in strategy consulting and renewable energy asset investment in London, where he interned with KPMG's Global Strategy Group, Deloitte's Strategy and Operations division, and Megawatt-X. Mr. Chung holds a BSc degree in management from the University of Warwick. ©2018 CFA Institute. All rights reserved. vii NITIN CHUGH Country Head, Digital Banking, HDFC Bank Limited, India Nitin Chugh is responsible for the Inbound and Outbound Contact Centers of the bank, including the Virtual Relationship Manager channel. In his current role, he is spearheading
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