Fintech use in S'pore almost triples to 67% in 2 years: EY

Index shows China, India global leaders, with 87% adoption rate

The use of fintech products and services has shot up in recent years.

A new study has found the adoption rate among Singapore consumers jumped from 23 per cent in 2017 to 67 per cent this year, higher than the global average of 64 per cent and the Asia-Pacific average of 63 per cent.

China and India emerged global leaders, with 87 per cent of their consumers adopting financial technology services.

The study was carried out by professional services firm EY for its annual index that is now in its third year. EY defines fintech as organisations that combine innovative business models and technology to enable financial services.

The index was based on an online survey of about 27,000 digitally active consumers in 27 markets. It included 1,000 small and medium-sized enterprises using fintech services in China, the United States, Britain, South Africa and Mexico.

EY global emerging markets fintech leader Varun Mittal said: "Singapore has enjoyed significantly increased rates of consumer fintech adoption, and we expect even higher rates in future, due to the supportive regulatory environment.

"Singapore may be a relatively small business-to-consumer market by size, but it is a hotbed for innovation and a great launchpad for start-ups and businesses to build their technology, test it and then scale across South-east Asia."

Mr Mittal added that most Asian markets benefit from a powerful "fintech feedback loop", with the increased adoption driving increased innovation, and vice versa.

EY's latest index shows that customer expectations have evolved, resulting in disruption and innovation in financial services.

In fact, traditional banks, insurers and wealth managers are disrupting their own propositions by offering digitally accessible and technology-forward services, EY noted.

Its findings also show that 27 per cent of consumers ranked pricing as their top priority when choosing a fintech service while 20 per cent picked ease of opening an account.

That being said, trust is the top barrier to using a fintech challenger as opposed to traditional financial institutions in markets such as Chile, France and Japan.

Mr Mittal also noted an emerging trend towards industry convergence, with sector leaders in adjacent industries such as transport, retail and telecommunications increasingly offering digitally enabled financial services.

"This is yet another area in which we believe that Asia will take a leading role, as it already has with fintech innovation and adoption," he said.

A version of this article appeared in the print edition of The Straits Times on June 27, 2019, with the headline 'Fintech use in S'pore almost triples to 67% in 2 years: EY'. Subscribe