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Android Pay launches in Singapore

Android Pay being used to make a purchase. Source: Straits Times.com

Android Pay launches in Singapore but faces an uphill battle. Apple Pay and Samsung Pay are already widely adopted in the Singaporean market and penetration of contactless POS systems (the tapping system that is integral to Singapore debit cards payments) is also not as high as it should be. Lastly, most cheaper Android phones simply do not have the right functionalities, which requires at least a version 4.4 KitKat and near field communications (NFC) capabilities, reported Forbes today.

Most interesting is the ecommerce potential. Google will launch Android Pay for in-app purchasing in the coming months and has announced Deliveroo, Grab, Shopee, Singapore Airlines, Uber and Zalora will be integrating in-app payment via Android Pay into their services.

Singapore will be the first Asian market to gain access to Android Pay with Singaporeans able to load Visa and  Mastercard credit and debit cards from six banks including DBS and Standard Chartered onto their android smartphones.

A version of this appeared in Forbes on June 27. Read the full article here.

 

Singapore Migshop Launches

Source: e27

Singapore-based social entertainment platform migme has announced the launch of  its social ecommerce migshop store, according to this article on e27. Migshop will offer curated items from major Southeast Asian ecommerce platform Lazada and India-based online marketplace Snapdeal.

The store will only be accessible to users from Thailand and India for now, but plans to expand to Philippines and other markets in the region are in the works.

“The social key influencers framework plays a leading role in driving online shopping and purchasing behaviour and this has contributed to the rise of this business model in other Asian markets. Companies such as Mogujie and Meilishuo in China, which have a combined value of $3 billion, have had great success in this area. We are confident we can replicate this strategy in our key markets, where there are similar dynamics,” said migme CEO Steven Goh.

Along with the acquisition of Sold.sg (pay-to-bid business) in 2015 and Shopdeca (B2C ecommerce retailer) in April 2016, the launch of this new platform is expected to give migme’s social ecommerce presence a generous boost.

Social commerce in Southeast Asia

The emerging market of Southeast Asia both boast high numbers of social networking users, many of whom check their social network pages via mobile phones. PwC latest survey revealed that Thailand and Malaysia are on the top five countries where online shoppers purchased directly from social media channels. Additionally, the fact that more than 50% shoppers in Southeast Asian countries such as Malaysia, Singapore and Thailand are turning to social media to consult about their purchase is will only strengthen the influence of the platform in the future.

A version of this article appeared in e27 on June 22. Read the full article here.

fintech opportunity in Southeast Asia

Source: fintechnews.sg

South Korea is being left out of a global wave of fintech alliances due to its inward-focused strategy and a lack of deregulatory reforms to respond to market changes. But the country aims to become Asia’s fintech center by building a “fintech bridge” with major nations, especially to seize the opportunity in Southeast Asia.

South Korea is trying to catch up with the global trend. On June 15, the Fintech Center of Korea, an affiliate of South Korea’s Financial Services Commission, hosted a Fintech Demoday in Singapore to promote Korean fintech firms’ entry into Southeast Asia.

However, Korea’s approach to seize the fintech opportunity in Southeast Asia does not seem to be in the right direction from two aspects:

  1. The strategy is focused too much on exporting Korean fintech abroad, rather than creating a financial innovation ecosystem through regulatory reforms and cooperation with other countries.
  2. Direct discussions are not being held among regulators. For meaningful alliances to create a more vibrant fintech ecosystem, it is important to clear regulatory hurdles through binding agreements between financial regulators.

Jeffrey Jones, an international lawyer specializing in finance comments,

It is very sad that we have one of the most tech-savvy populations on the globe, but the legal and regulatory system prevents this population from developing products and services that could create jobs for so many young people.

Such concern comes as global financial centers such as Singapore, Australia and the UK have joined hands to bolster the fintech industry and solidify their leadership position as global financial hubs. On June 16, the Monetary Authority of Singapore (MAS) and the Australian Securities and Investment Commission signed a contract to boost cooperation on financial innovation.

In May, Singapore and the UK also agreed to form a “fintech bridge” to foster financial innovation.

A version of this appeared in Korean Times on June 22. Read the full article here.

Vietnam's Advantage In European Trade Deal

Share of total EU-Asean Trade in 2015. Vietnam following behind Singapore, Source: Bloomberg.com

Vietnam may continue to take market share of the European Union trade from other Southeast Asian countries this year. The country accounted for 19.1 percent of the $227 billion (201.4 billion euros) in total trade between the EU and ASEAN nations last year, an increase from 15.8 percent in 2014 and could increase again 2016.

The country’s market growth combined with the finalization of the free trade pact indicates a more dynamic trade relationship in the future, according to the EU.

Vietnam has been steadily growing since 2014 when it overtook other ASEAN countries as the United States’ biggest exporter leaving traditional manufacturing hubs behind.

Vietnam was also able to capitalize on shifting production patterns in Asia as labor costs in China rose.

The ability to capitalize production led to Samsung Electronics Co.’s investment, it now assembles and exports smartphones from Vietnam. Several Vietnamese supply chain companies have now joined forces with the Vietnamese arm of Samsung. 

Although Singapore is still the EU’s biggest partner in Southeast Asia, it’s market share has dropped along with Thailand, Malaysia and Indonesia who lost market share to Vietnam. Vietnam’s makes a very appealing trade partner with the EU by exporting electronic products, coffee and clothes. It is now the second country in ASEAN after Singapore that the EU has signed a free trade pact with.

Vietnam’s rise as a key player in overseas trade

The EU has begun to target Vietnam and Singapore in a new business initiative aimed at giving European SMEs more exposure and opportunities in Southeast Asia. This means that countries such as Thailand and Indonesia risk being completely overtaken by Vietnam, as the country has managed to capitalize on many advantages. This will provide Vietnam with international growth potential, whether through trade or online.

As Thailand and Malaysia were enjoying its traditional manufacturing perks, Vietnam was struggling to catch up, but now it seems that the country is benefiting from slower initial growth. Samsung’s investment made a significant contribution, and now Vietnam is on track to becoming a key player in trade with the European Union.

A version of this appeared in Bloomberg Technology on June 16. Read the full article here.