The Singapore Fintech Festival is just around the corner. Asia’s fintech industry continues to grow in leaps and bounds: Last year, fintech investments in the region reached more than US$10 billion, and governments are doing their best to make financial regulation fintech-friendly. Suffice to say, most banks and other traditional financial service providers see fintech as a major disruptor to their market share. But what is it about the fintech sector that gives it such an edge?
Because we deal so heavily in corporate transactions, Concur – itself a fintech firm – works closely with a wide variety of finance businesses, from fintech start-ups to Asia’s biggest banks. I’ve observed four key aspects about successful fintech companies which distinguish them from their competition – and which the rest of the finance industry could afford to emulate.
1. They put collaboration at their core.
Fintech firms understand the value of working with others: they’re typically very open to partnering on solutions and sharing their data. Nowhere is this better seen than in the fintech sector’s APIs. An API essentially opens your product, service, or data for other companies to build upon.
Using Google’s API for Maps, for example, we can access the app’s location-tracking history to automatically record users’ mileage and calculate their amounts for reimbursement. This proves especially useful in countries like Malaysia where private car ownership still reigns. Most banks would find the concept of giving anyone access to their platforms alarming, but for fintech firms, it’s a natural part of growth.
2. They understand the value of speed.
We recently worked with Grab, the ride-hailing company that’s also a digital payments and wallet pioneer in Asia, to integrate their services with Concur’s expense-tracking functionality. The process, from the start of development to final launch, took less than 8 weeks! Another fintech, a payments aggregator, took only 3 weeks to develop a connector between its stack and ours – less than it took to sign the contract!
Fintech firms not only know how important it is to move fast, but they have the agile methodologies and culture in place to drive that speed. That makes it much easier for them to pivot in the face of any regulatory change or new opportunity.
3. They put Inclusivity over Exclusivity
Along with their APIs and openness to partnerships, fintech firms are generally far more transparent about their processes and strategy than more traditional financial companies. I’m always impressed by how willingly fintech founders will explain how they’ve come to build their product or service, and what plans they have to grow or develop in the next 12 months. That transparency not only reveals potential opportunities for everyone to benefit, but also raises potential issues or risks well ahead of time.
4. They obsess over data – and know when to use it.
Fintech firms know that every transaction is also a data point about their customers. Their leaders use this data to constantly hone and refine their strategy. Our own data, for example, found that business travelers worldwide spent nearly $70m on stays in Q4 2016 – on Airbnb. That sort of data not only helps us further refine our own platform – for example, tightening the integration with Airbnb’s services – but can also give guidance to companies on how to rethink their T&E and corporate finance policies for the sharing economy.
I see these four characteristics time and again in successful fintech firms, including Concur itself. To their credit, many banks and other traditional finance firms are taking steps to make their culture more agile and open, speed up their processes, and make better use of the data that they’re already collecting. What else do you think they can learn from the best of fintech?
Sandeep Krishnamani is Head of Partnerships – SE Asia at Concur based in Singapore.