The digital race in ASEAN’s changing landscape

Digitisation has presented businesses with unprecedented opportunities to stay connected with their customers. For companies operating in ASEAN, the quickening pace of digital adoption as the Covid-19 pandemic unfolded made the difference between striving and thriving. 

In a recent webinar series titled Digitising for Growth in ASEAN, organised by Standard Chartered, industry leaders agreed that selecting the right finance and technology partner is as important as putting the right digital payment solutions in place.

Participants included representatives from Bluebird Group, PayNet, Philippine Payments Management Inc., Aviva Asia, Prudential, Maxis Communications, XRND and PwC.

Digital payments trend

“We’re seeing a dramatic shift in consumer preference, away from cash and cheques and more towards new digital solutions,” said Ankur Kanwar, Managing Director and Head of Cash Products for Southeast Asia at Standard Chartered Bank.

“As the only international bank with presence in all ten markets across ASEAN, we continue to invest in digital solutions. A considerable number of unique use cases are being built using digital tools such as instant payments, QR code collections, Real-Time Direct Debit, online payment gateway, API services and Request to Pay to support our clients’ operations in this region,” Ankur noted.

The experiences of the national payment bodies of Malaysia and the Philippines bear this out. Carmelita Araneta, General Manager of Philippines Payments Management Inc., said that digital payments penetration is now approaching 20% – up from just 1% seven years ago.

Similarly, Khairuan Abdul Rahman, Director of Retail Payment Services at PayNet Malaysia, said that the volume of ecommerce transactions in the country “blew up in a big way” in March 2020 and hasn’t contracted since.

Echoing market sentiments, Rob Sewell, Chief Digital and Transformation Officer of Malaysian telecom operator Maxis, commented that there would be “an irreversible change both in how we engage with customers and what we engage on”.

Inspiring innovation

Industries such as insurance, healthcare and transportation have been leading the way on digitisation.

Pulse, the AI-based mobile super-app launched by Prudential Corporation Asia last year, now provides 10 million users with access to telemedicine and other health services, said Jitesh Malik, Prudential’s Payments and Loyalty Program Director.

Observing that success, Jitesh said, had led the insurer to ask: “How do we now use payment as a platform to springboard more micro-savings, micro-insurance or micro-investments?”

This led it to co-create the Pulse e-wallet with Standard Chartered. The service was launched in Malaysia and will be introduced in other countries in the region.

In education, the pandemic spurred institutions into offering short courses and lifelong learning programmes, said Tristan Hockley, PwC Singapore Education Industry Leader.

“You’re starting to see a coming-of-age of innovation in this sector and some real money and investment behind the companies that can do this,” Hockley said.

The move towards cashless systems has gained ground in the traditionally cash-based economy of Indonesia. Noni Purnomo, President Director of the country’s largest taxi fleet operator Blue Bird Group, said that about 75% of its operations in Bali are now cashless after the introduction of a multi-payment system.

Sustaining growth

While digitisation continues to grow across the region, patience is needed if sustainable growth is to be achieved.

“The last six months have really driven home the need for sustainable and resilient growth, and that may come at an initial cost to pure profit,” said David Wijeratne, Growth Markets Centre Leader at PwC Singapore.

Chris Wei, Executive Chairman of Aviva Asia, pointed out that “a variety of different solutions is needed for a variety of different situations”. In China, Aviva used the dominant portal there, WeChat, to build its distribution and payments platform, while in Singapore, the insurer used a digital platform that allowed the settlement of even small claims in a matter of minutes.

Such issues require careful thought, as the need to digitise effectively and efficiently remains paramount given the shift in consumer preferences.

Looking ahead, Naresh Alagan, co-founder of Malaysian boutique business and technology consultancy XRND, believes companies will have to rely on an industry ecosystem of partnerships to deliver traditional levels of customer service.

Framing how companies should approach digital technology adoption, Standard Chartered’s Ankur offered his perspective, “It’s more a matter of finding the use case you are trying to solve rather than simply pushing the technology out.”

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