By Arisa Siong – The ETF boom is happening and in a big way. The first two months of 2017 saw record global inflows into ETFs to the sum of US$130bn (ETFGI.com) – this is at least double to several times higher than inflows over the same period in the five years preceding. As a comparison, net inflows in 2016 amounted to US$390bn, which was a good year for ETFs but 2017 is shaping up to be even bigger. Most of the fund inflows into ETF stem from investors diverting funds from more-costly- actively managed funds into more-economical- ETF alternatives. The current industry trend is for the lowest cost funds to attract more and more funds. This in turn places downward pressure on management fees charged across the board by both ETFs and mutual funds. Vanguard and Schwab for instance, led the latest round of fee reductions in February.
Faced with increased price pressure and investment churn, mutual funds are forced join the race to zero. A report by JP Morgan and Oliver Wyman predict mutual funds will turn to ETFs to improve investment efficiency, in a bid to lower their costs. In particular, the report notes that ETFs should provide cost savings of 5-8bps for investments in mid to large cap stocks. Somewhat ironically, mutual funds could become the largest investors in ETFs, doubling current assets in ETF in 3-5 years. This is already happening now – Antoine de Saint Vaulry, Head of ETF and Flow Trading at Commerzbank, notes: “we see a blurring of the active-passive asset management divide, with more and more active asset managers using ETFs, to apply their investment strategies”.
In Asia, the ETF scene is still developing and while similar trends can be observed in Asian markets, the relative magnitude means that the impact is somewhat muted. Active fund management is still preferred and this lack of momentum means that there has not been the same pressure on management fees in Asia. Antoine de Saint Vaulry further adds that “the remuneration model for financial advisors in many countries is still not favourable to the development of ETFs, who can’t pay commissions. The markets who abandoned the commission based compensation models have seen massive inflows into ETFs (example Australia)“.
ETFs are also used differently across Asia. The central bank of Japan (BoJ) accounts for 60% of the Japanese ETF market and uses ETFs as a monetary policy tool. BoJ has invested over US$2bn in smart-beta ETFs that are designed to channel funds to companies that are making a positive impact on employment, wages and capital expenditure. Such use of ETFs is unique to Japan and Japan remains by far the largest ETF market in Asia – accounting for over half of AUM in the region. In Taiwan, where the Bureau of Labour Funds (BLF) accounts for 55% of the ETF market, product innovation in ETFs has been rapid – TWSE introduced leveraged and inverse ETFs in 2014, and futures-based ETF in 2015, tracking the price of gold futures. Last October, BLF publicly called for more smart-beta ETFs to complement its existing portfolio of leveraged and inverse ETFs – smart- beta ETFs are now expected imminently on the TWSE.
In Singapore, retail ETF AUM increased by 23% in 2016, with the total number of individual retail ETF holders up by 18% over the same period. This reflects the collective industry’s marketing and education efforts have been effective, though there is still much room for growth. The stats in Singapore exemplify that in Asian markets where institutional investors do not actively invest in ETFs, growth is likely to be significantly slower. It is less obvious where the drivers of innovation in ETFs are likely to come from. Drawing from the Taiwanese and Japanese markets, it would seem that a unified voice from the buy side has significant swaying power and would send the right signals to the ETF providers to create appropriate products. If on the other hand, this is not feasible as demand is naturally fragmented across a multitude of product types, then growth is likely to remain organic and progress somewhat slower.
Some exchanges are making effort to boost volumes however. Will Lawton of Eigencat notes that the Malaysian Securities Commission recently announced initiatives to incentivise issuers and investors to participate in the ETF market segment, broaden investors understanding of the asset class and will enhance facilitation to allow the ETF market to grow. In Singapore, SGX is partnering with Marvelstone to organise ETF Asia Forum (www.etfasiaforum.com) on the 30 March, an industry event meant to stimulate discussion on tapping opportunities to boost ETF growth in Asia. This year’s forum will focus on leveraging on fintech to drive growth.
SINGAPORE: Marvelstone Group will host a global FinTech summit in Singapore on 16th March, 2017, to bring together FinTech gurus of the region. The Fintech Global Summit aims to serve as a platform for learning, interaction and engagement with global FinTech minds. The summit will feature discussions on the latest innovations in technology that are fuelling the growth of FinTech. This includes the advent of crowdfunding, robo-investors, blockchain, big data, mobile payments and transfers. To tie it all together, the latest in cybersecurity development and regulatory measures that aid the growth of the sector will also be brought forward.
Key speakers at the event include Sopnendu Mohanty, Chief Fintech Officer at the Monetary Authority of Singapore and Neal Cross, Chief Innovation Officer at DBS Bank.
The day long event will be conducted in the form of talks and panel discussions, while also allowing attendees to network and learn about the present developments that are shaping up the future of FinTech. It will take place at what is know as the world’s largest FinTech hub, LATTICE80, which was launched in November 2016 and has quickly become the centre of the FinTech community in Singapore.
Joe Seunghyun Cho, Chairman of Marvelstone Group, said: “Fostering a strong sense of community within the FinTech world has always been the vision behind Marvelstone Group’s activities. We started off as a private equity business at the core, but soon dived into complementary businesses to facilitate the building of knowledge, relationships and strength. This, I believe, will provide enhanced value to our partners, investors, companies we invest in, and other key stakeholders. FinTech Global Summit in Singapore is a culmination of all these ideas and we are excited about it.”
More details about the event and tickets to the event are available on Eventbrite.
Marvelstone Group is a private investment group that develops and invests in growing businesses. With finance as its core strength, it also makes diversified investments in technology, real estate, infrastructure, energy and media.
LATTICE80, the world’s largest FinTech Hub, prides itself on creating an ecosystem for FinTech startups to collaborate, connect and co-create. The mission of the independent not for profit hub is to offer FinTech companies the opportunity to tap on the rich network and resources to develop smart technologies and springboard to international success. It boasts an impressive technological infrastructure that corporate members can leverage & lay a foundation to create a truly unique world-class community.
SINGAPORE: It has been an exciting 3 days at Startupbootcamp Fintech’s Singapore HQ, LATTICE80 this last weekend. Selection Days were on in which 19 startups from several countries took part. Early stage startups that have at least a beta product were invited for the selection process. 12 startups, from 8 different countries, have been finally chosen to be part of a 3 month accelerator programme.
The 12 startups will have access to Startupbootcamp’s masterclasses, corporate partners, desk-space at LATTICE80, investor access, and a host of other facilities to launch themselves towards a successful future.
A Demo Day in July will showcase the cohort’s learnings during the programme before investors, partners and mentors. The Monetary Authority of Singapore (MAS) will support the startups by providing guidance on regulatory matters.
Here’s the list:
Jumper.ai(India) The fastest way to buy, sell and collect payments everywhere within one unified AI interface.
ScalendTechnologies (India) Securely integrate data from different sources, take decisions, get insights, and focus on actively acquiring and engaging with customers in real time.
Fugle (Taiwan) The best digital brokerage firm for self-directed investors.
MostShorted.com (United Kingdom) Collecting, aggregating & providing data on hedge fund and activist shorts to improve decision making.
Smart Trade (Japan) Smart Trade is a trading platform that offers a web & mobile interface to develop, use and share AI algorithms.
Tixguru (Taiwan) Brings the best trading experience to you by offering a quant platform & AI Robot advisor.
Welltrado (Lithuania) P2P lending metasearch engine, an innovative alternative investment marketplace.
Morakot Technology(Cambodia) Simple and reliable core-banking system for microfinance institutions and banks.
Small Ticket(South Korea) Remodeling the distribution channel in providing insurance products via its own P2P insurance service platform, based on connected groups and controlled risks.
CherryPay(Taiwan) Faster, cheaper and more convenient international P2P money transfer matching platform.
AIM (South Korea) Automated Investment Service, a mobile-first robo advisor that helps retail users manage their wealth.
SmartFolios (Singapore) Online advisory and investment platform empowering investors to meet their investment goals.
In a country where cash has usually been the go to medium for both small and large transactions, the growing number of FinTech companies in India are gradually introducing the country to a digital world of financial services.
Though cryptocurrencies are currently seeing a rise globally, it is still the more traditional services like lending and access to banking through technology that is the highlight of the Indian market. And it all seems to be working from the statistics available. The unbanked population in India in 2011 was about 557 million. In a span of barely 4 years, by 2015, this number had come down to 233 million – which is a sharp drop of almost half – as per a report made available via the Internet and Mobile Association of India (IAMAI) and Payments Council of India (PCI). The Indian government launched the Pradhan Mantri Jan Dhan Yojana in 2014 to ensure every household in India has a bank account, and that’s the year in which about 182 million bank accounts were opened. That’s the average citizen’s side of things.
When a market the size of India with about 1.3 billion citizens transacts mostly using cash, a record of about 68% of all transactions in the nation just does not exist. This leads to a situation where those doing business in cash can easily evade sales and income tax. Which in return puts a strain on the government’s ability to spend on infrastructure, healthcare, education, etc. of what is now the world’s fastest growing economy.
To curb such common practice to a certain extent, the Government of India on 08th November, 2016 announced the immediate withdrawal of the high-denomination Rs 500 and Rs 1000 notes from circulation in the nation. The announcement which was unscheduled put the Reserve Bank of India (RBI) and the entire banking system in a frenzy. As of 31st March 2016, the RBI annual report had stated that there were currency notes valued at 16.42 trillion rupees (USD 240 billion) in circulation – 86% of which, valued at 14.18 trillion rupees (USD 210 billion), were the Rs 500 and Rs 1000 notes.
While India is still springing back from the shortage of currency notes, the adoption of plastic money in the general and recently banked population went up. At the same time several mobile wallet startups, who rely on their accounts being funded through a bank account transfer, saw an opportunity to drive adoption of P2P transfers via mobile phones. This worked especially in scenarios where smaller merchants did not have access to POS machines as they had always done business with cash. In a country with 1 billion mobile subscribers (as of 2016), where adoption of such wallets was still a challenge in the physical world, the government’s push for a Digital India did the trick.
With access to bank accounts, digital services such as e-commerce, and increasingly improving internet connectivity the average Indian citizen is not just banking online. Financial services such as payment gateways that facilitate e-commerce, P2P loans, lending for SMEs, low-cost POS machines, selling insurance online are all seeing definite growth.
Here are 11 FinTech startups in India to know about:
PayTM started off as a mobile recharge and utility bill payments. Funding from various large investors as Ant Financial, Alibaba Group the company has quickly evolved by providing varied services. These range from a mobile wallet, a dedicated e-commerce arm, to an RBI approved Payments Bank.
Total funding: $760 million Key Investors: Ant Financial, Alibaba Group, Mountain Capital, HDFC Bank, ICICI Bank, SAIF Partners, Saama Capital, Silicon Valley Bank, Reliance Capital, MediaTek Founder: Vijay Shekhar Sharma Founded year: 2010
FreeCharge, known for its quirky and fresh interface, too started off in the mobile recharge and bill payments space. The acquisition of the company by Snapdeal, a major e-commerce player in India, in Apr 2015 allowed FreeCharge to build its presence in the digital payments space as well. Post the acquisition, in September 2015, the company launched a digital wallet to facilitate transactions across the FreeCharge and Snapdeal platforms.
Total funding: $117 million Key Investors: Sequoia Capital, Sofina, ruNet, Tandon Group, Tybourne Capital Management, InnoVen Capital Founders: Kunal Shah, Sandeep Tandon Founded year: 2010
This digital payments startup in India founded by two young graduates out of Indian Institute of Technology, Roorkee seems to be getting the right kind of attention for its agility. Chosen as one of NASSCOM’s ‘League of 10’ companies, raising investment at YCombinator’s Winter 2015 demo day, and getting a strategic investment from MasterCard as part of their ‘Start Path’ programme (the only one by the card scheme in an Indian FinTech company) all put together brought Razorpay in the limelight.
Total funding: $11.6 million Key Investors: Tiger Global, MasterCard, YCombinator, Matrix Partners India, Kunal Bahl (Founder, SnapDeal), Kunal Shah (Founder, Freecharge), GMO VenturePartners Founders: Shashank Kumar, Harshil Mathur Founded year: 2013
BankBazaar brings access to comparing and applying for credit-based services from banks to its customers. This includes loans and credit cards. In 2015, an arm of BankBazaar called BankBazaar Insurance also brought the facility to buy insurance online through the website. The online portal claims to have about 8 million customers.
Total funding: $80 million Key Investors: Amazon, Sequoia Capital, Walden International, Eight Roads Ventures Founders: Adhil Shetty, Arjun Shetty, Rati Shetty Founded year: 2008
LendingKart is an online enabler of access to collateral free working capital loans for small-and-medium-enterprises (SMEs) in India. The company refers to the applicant’s cash flow, credit history and customer experiences to evaluate the business. Funds offered range from INR 50 thousand to INR 1 crore (100 million rupees) with tenure of 1 month to 1 year. For a country of vast geographic and social scale, the service has gained quite some popularity while being based out of Ahmedabad in the state of Gujarat.
Total funding: $42 million Key Investors: IFMR Trust, Saama Capital, Mayfield, Bertelsmann, India Quotient, Bertelsmann India Investments Founders: Harshvardhan Lunia, Mukul Sachan Founded year: 2014
Centred around customer service, transparency and clarity of the terms of various insurance options, PolicyBazaar is one of the largest online insurance brokers in India. Various kinds of insurance are categorised based on varying customer needs. The company has been getting consistent investments and aims to turn into a profitable one in 2017.
Total funding: $83 million Key Investors: Info Edge India, Inventus Capital Partners, Intel Capital, Tiger Global Management, Ribbit Capital, ABG Capital, Steadview Capital, Premji Invest Founders: Yashish Dahiya, Alok Bansal, Avaneesh Nirjar Founded year: 2008
Founded by former Deutsche Bank executive, Bhupinder Singh, InCred provides SMEs, consumer/personal, home and education loans in the Indian market. Backed by another financial executive Anshu Jain, former Deutsche Bank co-CEO, among others gives InCred the hardcore mindset to deliver financial services at scale.
Total funding: $74 million Key Investors: IDFC, Alpha Capital Founder: Bhupinder Singh Founded year: 2016
MobiKwik is another mobile wallet player in India which has recently benefited from the demonetisation in India. Mostly similar in its offering to customers like other competitors, the company has frequently tried various strategies like ‘cash-pick-up at home to load e-wallet’ aimed at the Indian customers habits.
Total funding: $127 million Key Investors: American Express, Sequoia Capital, GMO, MediaTek, NET1, Cisco Investments, Tree Line Investment Management, InnoVen Capital Founders: Upasana Taku, Bipin Preet Singh Founded year: 2009
FINO PayTech is an institutional investor driven company which provides low-cost payment technology. Solutions include biometric-enabled Kiosk Banking for rural market, handheld device based banking transactions with biometric authentication, Financial Inclusion Gateway for effective business correspondent management. The company also works directly in micro-lending and micro-insurance through their Non-Banking Financial Company (NBFC) Intrepid Finance & Leasing.
Total funding: $110.5 million Key Investors: ICICI Bank, IFMR Trust, HSBC Group, Life Insurance Corporation of India, IFC, Blackstone, ICICI Prudential Life Insurance, Intel Capital, Corporation Bank, Legatum, ICICI Lombard, Bharat Petroleum, Union Bank Of India, Indian Bank, Headlands Capital Founders: Rishi Gupta, Rajeev Arora Founded year: 2006
Pine Labs provides retail point-of-sale (POS) machines to offline merchants to facilitate payments acceptance. With an estimated network of about 50000 merchants, the company is now led by CEO Lokvir Kapoor. In 2016, the company appointed former Vodafone CEO Arun Sarin and Visa Global Head of Commercial Business Vicky Bindra as members of its board.
Total funding: $20 million Key Investors: Sequoia Capital, New Atlantic Ventures Founder: Rajul Garg Founded year: 1998
Faircent is a P2P lending platform that connects borrowers and lenders to interact directly. Lenders can individually make offers to borrowers, which the borrower can accept or refuse. Offers are defined in terms of amount to be lent and the applicable interest rate. Both lenders and borrowers can interact and make transactions with multiple people. Faircent claims to eliminate the high margins which banks and financial institutions make on transactions, and pass it on to the customer as a saving on the services availed.
Total funding: $8.25 million Key Investors: Aarin Capital, Brand Capital, JM Financial, M and S Capital Partners Founders: Nitin Gupta, Rajat Gandhi, Vinay Mathews Founded year: 2013
As one of the fastest growing industries in the world, the FinTech industry has been the go-to industry for many of the top talents around the world. Since gaining popularity, the FinTech industry has attracted traditional powerhouses, disruptive upstarts and plenty of investors. We looked into the FinTech talents to come up with a list of top FinTech influencers that all FinTech hustlers, investors and incumbents need to know about.
We ranked the top FinTech influencers based on their Klout score, i.e. their social media influence. Klout score is an indicator of influence and presence that is calculated using social media data from LinkedIn, Twitter, Facebook and many other online sources. Similar to how Google’s search engine ranks the relevance of every web page, Klout ranks the influence of every person online.
So here are the Top 63 FinTech influencers you need to know in Asia.
Top 63 FinTech Influencers You Need To Know in Asia (Last Update : 28 Jan 17)
Vijay Shekhar Sharma is the Founder of Paytm Mobile Solutions Private Limited and serves as its Chief Executive Officer. Vijay is known as the man who broke the conventional concepts of cashflow with his founding of Paytm Mobile Solutions.
Paul Ark is an active startup mentor and angel investor, having made investments in early stage companies in the United States, China, and Thailand. He currently manages the FinTech venture capital fund for Siam Commercial Bank’s Digital Ventures group.
Lim Jung Wook is the managing director of Startup Alliance, a non-profit organisation founded in 2013 to foster South Korea’s startup scene, connecting entrepreneurs, startups, tech companies, and the government.
Prakash Somosundram is a serial Entrepreneur. Prakash is currently the Co-Founder & Director at The Singapore FinTech Consortium. He wants to shape The Singapore FinTech Consortium into a platform to facilitate Fund Raising, Mergers & Acquisitions, Partnerships and Exits in an effective manner.
Neal Cross is the Managing Director and Chief Innovation Officer of DBS Bank and a strong advocate for innovation thinking and culture. He has been recognized as the most disruptive Chief Innovation Officer (CIO)/ Chief Technology Officer (CTO) globally by panel which consists of prominent business innovators including Apple co-Founder Steve Wozniak and Virgin Group Founder, Sir Richard Branson.
Aman Narain is the CEO of BankBazaar International, India’s leading Financial Marketplace. Aman is looking to bring BankBazaar into Asia. Aman was the former Global Head of Digital Banking for Standard Chartered where he had responsibility for all direct to consumer channels, including Online, Mobile & ATM’s. He also managed all internal digital channels and social media.
Amit is the Co-Founder & Chief Curator of Let’s Talk Payments. His strength lies in strategy and market analysis and has advised several amazing companies in the payments, commerce and technology space.
Vladislav (Slava) Solodkiy founded Life.SREDA VC, a fintech-only fund 3 years ago. Slava is also an evangelist of Singapore as international fintech hub. He was recently highlighted by Institutional Investor, UK magazine, as one of TOP35 most influential fintech-persons in the world.
Matt Dooley is a thought leader, speaker and trainer on financial services marketing, digital customer experience and innovation. He is currently a mentor and advisor at Startupbootcamp, specializing in strategic Consulting, including business proposition, business plan & sales strategy development, financial services trends and landscape.
Suvodeep Das is currently the VP Marketing at Sodexo SVC India where he runs marketing, & communication, launch new products & anchor the brand’s Digital transformation. Before his stint at Sodexo, he led Greenlight Planet’s marketing, communication, channel expansion and global innovation.
Faisal Khan is a Pakistan-based consultant and blogger specializing in banking, payments and fintech. He covers cutting-edged technologies and explains how specific innovations work. From time to time, he also conducts market analysis, product reviews and report summaries.
Adrianna Tan founded Wobe in 2014, an innovative take on financial services for the low income segment of Southeast Asia. Previously, Adrianna works on the intersection of tech, content and social. From founding and growing tech startups in Southeast Asia to starting and running non-profits in India, she believes strongly that technology and social good can and should go together.
Scott Bales is the founder of Metlife’s Innovation Centre. He now runs Innovation Labs Asia in Singapore. He’s also a founding member of Next Bank and the vice president of The Mobile Alliance Singapore.
As the Chief Digital Officer in Asia, Wyn has responsibility for the Aviva digital agenda in the region. She oversees initiatives to improve the digital customer experience, drive digital innovation in the business and build digital capabilities in markets. She is a digital native who had held regional and global roles in product management, business development, venture investment, digital strategy and marketing. She had led regional digital teams for Nokia, eBay, Avaya and SAP.
Brad Jones is the Chief Executive Officer of Wave Money, an experienced executive specializing in digital finance, mobile money and business transformation in developing markets, including Asia, Africa and the Middle East.
Stefano Covolan was the Ex-CEO of Yourp. Stefano is currently working on the Dragon Wealth fintech startup to create the Dragon Wealth app, Upefy platform for Financial Advisors, and Red Dot Financial website. Stefano’s passion lies in bridging the gap between financial advisors and prospects/clients in Singapore and Vietnam
James Lloyd is a part of the EY Asia-Pacific Financial Services Organization (FSO), a fully dedicated and integrated entity with a unique approach focused exclusively on servicing the needs of EY’s clients in the financial services industry.
George Kesselman, co-founder of InsurTechAsia, is a passionate individual who wants to bring change to the under-digitalized insurance industry. He wants to reshape it to fulfill purpose of doing good for people.
Founder of Next Money. Findlay has served as a mentor for startups in the IBM Watson New Venture Challenge and Startupbootcamp FinTech in Singapore. He currently holds a consulting role on developing and leading a customer experience design practice at DBS as a senior vice president.
Chris Doerfler has been actively involved in the Fintech industry as a cybersecurity, Blockchain and Fintech advisor. He has previously run the cybersecurity, compliance & expansion initiatives for the fintech /global payments arm of Tadley Asia. He is now the co-founder of Ramps.io to redefine Fintech business use-case solution design & advisory.
Shwetank Verma is a start-up specialist. His focus is on bringing new concepts to market and setting them up to scale by combining the concepts of design thinking and lean entrepreneurship. He is currently an innovator at MetLife, in charge of driving forward new revenue opportunities and broadly focused on being an intrapreneur within the larger organization, with a focus on application of new technologies (VR/AI) in fintech and digital health.
Jessica Ellerm is the Banking Business Development Manager for Tyro Payments, Australia’s most successful fintech start-up. She has been with Tyro in a business development capacity since 2009 and now heads up the banking team. She works closely with the internal product and existing sales team to integrate the new deposit and lending solutions into the sales cycle, as well as develop cornerstone accounting integration relationships with cloud accounting providers. Alongside Tyro, Jessica is an active Australian and global fintech commentator, writing for her own blog and a number of global publications including Daily Fintech and BankNXT. She is the Australian correspondent for Brett King’s Breaking Banks radio show on Voice America.
Augustus Loi is a venture capitalist at Infocomm Investments Pte Ltd, a venture capital arm of Singapore Infocomm Development Authority. He looks at technology start-ups that are: suitable for direct investment (seed stage to pre-IPO) and suitable for support given national strategic and/or Smart Nation relevance.
Simone McCallum is currently working for NZ’s ASB Bank and is responsible for the award winning Virtual Branch on Facebook and social media teams. She has over 10 years experience in the financial services industry, and passionate about all things digital and social.
Singapore FinTech Festival aims to bring together the global financial community in a week-long celebration of FinTech. The Singapore FinTech Festival is organized by the Monetary Authority of Singapore (MAS) in partnership with The Association of Banks in Singapore (ABS) and is the largest Fintech event in the world.
Henri Arslanian is an Adjunct Associate Professor at Hong Kong University where he teaches graduate courses on Entrepreneurship in Finance as well as the first FinTech university course in Asia. He previously spent many years with UBS Investment Bank in Hong Kong and started his career as a financial markets and funds lawyer. A member of the Milken Institute’s Young Leaders Circle and with over 70,000 LinkedIn followers, Henri is a regular speaker on the topic of FinTech to various audiences, ranging from TEDx to Fortune 500 management teams. He also sits on a number of other finance, academic, civil society and FinTech related boards and advisory committees including the HKSFA FinTech Committee and the FSDC Fintech Advisory Team.
With over 24 years of experience in Banking & Financial Services industry, Balasubramaniam currently sits as the senior vice president of DBS Risk Management Group. He is working on collaboration with Fin-tech Partners, Innovation Hubs and Model Building for Digital Verticals for payment products, loans and SME offerings.
Bert-Jan van Essen used to be the CIO of UBS before leaving UBS to start his own fintech company Dragon Wealth with Steven Covolan. Dragon Wealth has evolved into a major fintech company. It has developed Upefy, an all-in- one automated software that works like a very efficient assistant, keeping tabs on your website and clients like a hawk.
Tejasvi Mohanram is the founder & CEO of RupeePower. RupeePower is a leading consumer & retail credit platform in India with INR 9,000 crore (USD 1.3 bn) in credit disbursals to customers, suiting their individual need for speed, price and ease, while generating concrete business results for some of the largest Indian and global banks.
As the new Chief Fintech Officer at MAS, Sopnendu is responsible for creating development strategies and regulatory policies around technology innovation to “better manage risks, enhance efficiency and strengthen competitiveness in the financial sector”.
Guillermo Musumeci is the Chief Technology Officer at Ballr.com with 20 years of international experience. Ballr is a free gaming platform for fans to connect, compete and communicate during real-time sporting events. Apart from Ballr, Guillermo is also the founder of KopiCloud, which develops Multi-Cloud Automation Tools for Amazon AWS, Microsoft Azure and Google Cloud.
Matt is currently engaged in several machine learning and artificial intelligence projects including Red Marker, an Australian RegTech pioneer. Red Marker has developed Artemis an automated compliance solution for regulated entities.
Markus Gnirck was named the Forbes Asia 30 under 30 in 2016 in Venture Capital & Finance. He is currently the Managing Director of tryb Capital. tryb Capital invests in growth stage infrastrucuture technology and platforms transforming financial services in ASEAN
Richard Eldridge serves as Executive Officer and Director of Lenddo International. He is responsible for Lenddo operation across Asia as well as developing the long-term strategic direction across the world.
Paul Chapman is the Founder and CTO at Thomson Reuters cvMail (acquired 2007), and IT Director at en japan subsidiary, en world (Tokyo). In 2012, Paul co-founded Moneytree KK with Ross Sharrott and Mark Makdad.
Manish Agarwal joined Kotak Mahindra Bank in 2007 as Vice President Interactive & Innovation. His role at Mahindra Bank is to provide Direction & Strategy for using the ever changing interactive channel ( Internet & Mobile ) and leverage the same for every aspect of the business and create visible differentiation in the mind of consumers.
Janos Barberis is a Millennial in FinTech who is recognised as a top-35 global FinTech leader. He founded FinTech HK, a thought leadership platform, and the SuperCharger – a FinTech Accelerator that strategically leverages on Hong Kong as a gateway to Asia. In parallel, he sits on the advisory board of the World Economic Forum’s FinTech Committee and is a PhD Candidate at Hong Kong University Law School. Previously, Janos was the first hire at a prospective UK challenger bank, Lintel, helping it to secure a banking license from the PRA & FCA. This role followed a specialist interest developed over 7 years, in financial systems and their stability. He also introduced the framework of developing real-time and dynamic regulatory supervision models for financial networks.
Mehedi Hasan Sumon is the Founder & CEO of MyCash Online, a FinTech solution provider for the un-bankable people in South & South East Asia. He is also Managing Partner of LYL Technology , a Malaysia based Technology & Digital Entertainment startup.
Dusan has also contributed to a number of different organizations and entrepreneurs through donations. After his 3 exits in 2012, he donated a portion of his proceeds to save the last Tesla Lab, the Tesla Science Centre on Long Island, New York State. He is also did a smaller donation to the Tesla Statue in Palo Alto. As a distant relative to Nikola Tesla, Dusan is a strong supporter of all things Tesla. In 2015, he had one major exit and some partial exits, One was Prowebce which was sold to Edenred in May. One of the partial exits was when SharesPost sold its interest in NASDAQ Private Market to Nasdaq, Inc.
LATTICE80 (initiated by Marvelstone Group) is a not-for-profit Fintech Hub which opened in Nov 2016. It is the world’s largest Fintech Hub with over 30,000 sqft of work and shared space. LATTICE80 aims to support the emerging Fintech ecosystem in Asia creating a robust bridge to the entire region.
Mikko Perez has a successful track record investing in and operating innovative technology, new media and telecom-related ventures from his revious experience as an investment banker at JP Morgan Chase specializing in technology, media and telecom ventures
Teguh Ariwibowo is the CEO and Co-founder of Pinjam. Started bussines experience with Voila ( www.voila.co.id ) continue the journey at financial technology start up called pinjam ( www.pinjam.co.id ) as digital lending platform. His passion is about entrepreneurship. At 2013, just awarded as the most promising entrepreneur from Asia pacific entrepreneurship award by enterprise Asia.Twitter Followers: 1,321
Smart Beta is not something new, but definitely a topic that has recently been a focal point in the fund management industry.
Smart Beta in essence is a hybrid of the traditional strategies of investing – active and passive investment strategies. Smart Beta strategies have been the most widely used in exchange traded funds (ETFs) and specifically in equities.
As the name suggests, active strategies are “actively” managed by portfolio managers for a fee. The investment managers continuously assesses the underlying assets of the investments and their mission statement is to provide good returns for their customers. By implementing these active strategies, investment managers are known to be able to generate “alpha”, which is nothing but a return on the fund which is higher than the benchmark.
Passive strategies on the other hand are those that generally track an index, are rules-based, and are not monitored continuously to achieve much higher than the underlying asset itself demanding a much lower fee than active funds. The underlying assets of the investment have different “beta”.
Alpha is the abnormal rate of return on a security or portfolio in excess of what would be predicted. It is typically only attained by actively managed investments.
Beta is a measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole. You can think of it as the tendency of that stock or fund’s returns to respond to swings in the market.
Market size of Smart Beta products
The interest in smart beta products is growing globally.
As of June 2016, smart beta ETFs account for $429 billion (ETFGI), with new inflows of $45 billion for the year till November 2016 (Morningstar).
Further, BlackRock projects that total assets under management in smart beta ETFs will grow to $1 trillion by 2020, and then reach $2.4 trillion by 2025.
However, the adoption in the Asian context has been slow due to:
limited investment in building the smart beta exchange traded products
misaligned incentives. i.e. higher remuneration for brokers to promote other products
lack of investor knowledge
The majority of smart beta ETFs investors in Asia are in Japan and Australia. Japan accounted for the biggest slice of assets under management in smart-beta ETFs, with $7.3 billion invested. Initiatives from Japan’s Government Pension Fund and the Bank of Japan to get investors to increase their exposure to ETFs have contributed to these inflows. In Hong Kong, there are only 19 smart beta ETFs that are listed with combined assets of about $200 million as of June 2016.
Goals of Smart Beta
Increase diversification in a more cost-effective manner
Benefits of Smart Beta
Almost 50% of the smart beta ETFs have expense ratios below 50bps, but we do see a range from as low as 9bps to as high as 280 bps.
Diversification and reduced portfolio risks
Investments do not need to follow pure market capitalization based products and can be diversified and follow other factors.
Enhanced portfolio returns
Broadly speaking, the 1-year average returns of all ETFs globally has been over 9.8%, but there are exceptions with some smart beta ETFs losing almost as much as 100% and those gaining over 130%.
Aspects of Smart Beta strategies
There are several aspects that need to be considered for the success of smart beta strategies:
Factors such as price, quality, dividend, and value are incorporated into the strategy.
Smart beta doesn’t blindly follow the indexes like passive funds which are based on only one factor – market capitalization.
Portfolio construction comes into play and is important in as it sets various rules which might take a single factors or multi-factor approach with different weights for the underlying factors.
Implementation of the strategy is important. For example, the strategy needs to take into consideration that the underlying companies in the index may have high value, but might not be very liquid.
Smart beta decisions are essentially driven by data and enhanced with technology. As the two enablers advance, it makes the execution of smart beta strategies even more consistent and cheaper from a fund management perspective. Given these factors, we expect an increased interest in smart beta investment products in Asia, driven by the pension industry.
Inspiration & creativity come from cross-pollination of various people from different spheres or specializations. Informal chats and discoveries that arise from interacting with others play a large role in coworking.
Spaces designed to promote these activities increase the likelihood of collaboration – and statistics has repeatedly demonstrated that more collision create positive results.
According to Bisner Newsroom, in 2011 there were about 1000 coworking spaces worldwide, with a dominant presence in Europe and the US. Three years later, in 2014, there are almost 6000 coworking spaces. The forecasts suggest that the growth is unstoppable: by 2018 there will be 37,000 coworking spaces spread across all of the continents. It is expected that by 2018 there will be 2,370,000 professionals who buy membership at a coworking space.
Coworking space, besides being a more reasonable alternative to stand-alone offices has become a symbol of collaboration, connectivity and efficiency. Today large companies, and small business relate to the relevance and importance of collaboration within their teams.
Besides space, coworking entities that can also helps connect with government agencies, external peers, subject matter experts and companies will be the next big wave. The virtual collaboration market in 2016 is expected to be worth $6.4 billion and projected to grow exponentially.
Within the coworking circle, the question being asked is the relevance and importance of having a dedicated space for Fintech. One of reasons could be the fact that working in an open plan environment may not necessarily be appropriate for Fintech startups due to customer data protection and privacy.
Fintech startups have been thriving globally but what is lacking is a very strong support infrastructure. Along with a large enough space to host the growing community, the need of the hour is a strong alignment of initiatives and investment with governments, corporates, regulators and other industry stakeholders.
In future, it is also possible for coworking spaces to give rise to ecosystems that can provide a bouquet of services to enable non-typical startups – eg. fledgling fund managers who may have great ideas for investment products but unable to cross the infrastructure and regulatory hurdles without investing in expensive back office platforms.
Support services including access to Fintech specific network, licensing, legal services and introduction to the right partners, events to share best practices, education around regulatory aspects all under one roof is where Singapore’s future lies in making it an innovative economy.
This fits very well with the country’s aim to build a well-balanced fintech innovation ecosystem that can be adopted globally.
(Image source : The Great Room Offices in Singapore)