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Digital Banking in Asia Pacific

In the last five years, digital banking in the Asia Pacific (APAC) region has taken off at an unprecedented scale. Since the onset of the Covid-19 pandemic, 60% of banks globally have closed or shortened opening hours of branches, but many have also implemented new digital features, such as fully digital processes.

Digital banking in APAC : customer needs and expectations

In APAC, rapidly changing customer preferences and expectations have driven consumers’ openness to digital banking. A recent study* found that two out of three banking customers in APAC would consider switching to fintechs and challenger banks that they perceive as being successful in addressing customer pain-points and facilitating customer journeys.

A study* polled 5,000 digital banking customers in ten key APAC markets and found that :

  • Southeast Asian customers are the most receptive to fintechs, challenger banks and new entrants.
  • Digital payments in APAC are also on the rise.
  • 65% of APAC customers now prefer to use digital channels to engage with their bank during financial hardship.
  • The number of digital banking customers have grown throughout the pandemic.
  • APAC banking customers today demand a smooth, hassle-free and digital on-boarding process, improved pricing on financial products, and personalized products. Where before online banking might have been for the young and adventurous, it is now an essential part of our digital society.
  • The majority (62%) of APAC customers prefer to begin a new banking relationship digitally, though 40% said they were willing to visit a branch if required.


digital banking customers in 10 key APAC markets

Australia/New Zealand

Customers in more developed economies like New Zealand and Australia, were found to be the lesser inclined to consider fintechs, with 61% and 51% of respondents, respectively, stating they were not willing to try a fintech or challenger bank.


In China, 92% of people in the largest cities use Wechat Pay or Alipay as their main means of payment.

In rural areas, 47% of the population is reported to regularly use mobile payments.


Thailand scored the highest with 78% of respondents stating they were open to consider a fintech, followed by Vietnam with 77%, and Indonesia with 69%.

Southeast Asia

Recently in Southeast Asia, the central banks of five of Southeast Asia’s largest economies – Singapore, Malaysia, Indonesia, Thailand and the Philippines – have agreed to link their digital payment systems by November 2022 to allow for easier transactions for travellers within the region.

Across the region, the appeal of in-person branch banking is fading fast.


In Japan, 60% of respondents in a digital banking survey said that they would likely switch to digital banking within the next two years.

They cited pain points such as long waiting times at physical banks and in-person bank meetings as the top reasons for switching but were also highly concerned about the security of digital banking. In November 2021, government regulations changed to allow a variety of financial products – banking, securities and insurance – to be sold under a single financial services brokerage license. This will make it easier for consumers to access financial products via a smartphone app. Previously, companies needed to obtain separate licenses for different offerings.

62% of Japanese consumers still prefer to make payments by credit card, while the market share for e-wallets and app payments is just 11% with PayPay and LINEPay being the most popular.

However, the fintech market remains nascent in Japan. The biggest fintech fundraising in Japan so far has been a $120 million haul by Liquid Group, which runs cryptocurrency exchanges in Singapore and Japan. Liquid remains the only fintech unicorn – private companies with a valuation of $1 billion or more in Japan.


In India, digital payments have seen a massive boom with a compound annual growth rate of 30%.

The pandemic has played a crucial role in introducing new developments coupled with technological advancements and regulatory support, which have now transformed the industry significantly.

This has been furthered by the Unified Payments Interface (UPI) which was introduced in 2016. During the pandemic, UPI has witnessed extraordinary adoption, reaching a record 46 billion transactions in 2021. The platform approach taken by the government in conceptualizing UPI has resulted in innovative payments products being developed. As a result of which payments can be made with the click of a mobile phone not just at retail outlets but also peer-to-peer, completely redefining the way in which money is transferred between individuals.

A “whole of India approach” towards financial inclusion has also resulted in Direct Benefit Transfer through apps that extend microcredit facilities to street vendors, making digital banking accessible to a more diverse customer base.

20% of 250 (worldwide or global digital banks) are in APAC.

100% perform digital delivery to customers.

To date, about 5% of the 250 worldwide or global digital banks, and of those, 10 are based in APAC.

The 10 profitable digital banks have established strong lending propositions.

4 of the 10 entered banking from digital payments.

Industry trends

As some APAC markets move to second and third generation digital banking, we will see even more sophistication and richer engagement with more consumers. On the horizon is the as-yet untapped potential of open banking, where consumers’ choice of products and services will no longer be restricted to one specific bank.

This trend in digital banking has not only forced existing traditional banks to re-think delivery of services to consumers and accelerate their digital transformation but also paved the way for new, online banks to enter the APAC banking market.

20% of 250 digital banks worldwide are in APAC. More than 70% of them were established between 2016 and 2020. They seek to serve customers with diversified and personalized offerings, and they share key features such as electronic client servicing, a comprehensive digital infrastructure underpinning their operations, and 100% digital delivery to customers.

Many have corporate backers and joint venture partners including incumbent local banks, global banks, technology and telecommunications companies, and e-commerce ventures, among others.

To date, about 5% of the 250 digital banks worldwide are profitable, and of those, 10 are based in APAC. Still, none of these have captured more than 2% of market share* in terms of total value of deposits and loans within their target segments (typically retail customers and small businesses). The 10 profitable digital banks have established strong lending propositions. Four of the 10 entered banking from digital payments. An Era of both neo – digital only – and challenger banks the prospect of easy access and flexible banking would convince them to switch to a new-age financial provider.

What is clear is that as banks blend ever more consumer choice via digital platforms, their relationship with the customer will change significantly.

Banking customers demand seamless user access to a mix services and brands that they curate themselves and have more choice to shape their own personal digital banking services ecosystems. This means that the balance of power is rapidly moving to the customer as the revolution in digital banking starts to gather pace.

Atos is working with our banking customers and global partners to help navigate and accelerate business and digital transformation to deliver banks’ priorities and ambitions.

Atos insights into banking trends

Trends over the past decade, away from the banking of the past, have only been accelerated by the impact of the global Covid-19 pandemic. And the way in which banking will continue to evolve in the months and years ahead is apparent in global research that Atos recently conducted with hundreds of banking leaders.*

We found that two-thirds of retail banking leaders believe that transforming the digital customer experience is a top 5 priority over the next 12 months.

We see that data, along with digital technologies like AI/ML, is being used for augmenting human cognitive capabilities with Robo-advisors, virtual assistants, chatbots and knowledge engineering. 80% believe that digital is essential to achieving their decarbonization targets.

Almost half say account security and protection from fraud is a key priority. Cybersecurity is definitely a key priority and challenge.

In short, as we head further into the 2020s, digital banking is becoming smarter, greener, and safer.

With fintechs and platform eco-system, the banking sector continues to shift to digital platforms and be integrated seamlessly into multipurpose platforms and other industries’ value chains.

A digital future of banking will also be a greener future. That is evidenced by initiatives like the Net-Zero Banking Alliance which is bringing together 53 banks from 27 countries representing almost a quarter of global banking assets (over $37 trillion) to decarbonize our industry. As a Dow Jones Sustainability Index leader in decarbonization, Atos is committed to working with our banking customers to implement the solutions they require to fulfil net zero ambitions.

The intelligence, agility and efficiency with which banks leverage customer data is the foundation for differentiation and success – but only if banks can translate it into an experience that makes their customers love them.

Atos reveals how every process and every business technology within banking can be exploited to contribute to better customer experience.

We see the following essentials for banks in the years to come:

Smarter Banking

  • Banking will continue to shift to digital banking platforms and be integrated seamlessly into multipurpose platforms and other industries’ value chains.
  • Traditional banks matter, as they have the cash, the names, the trust, and the customer base. However, they need to continuously evolve to keep pace with digital evolution.
  • Fintechs will function as disrupters in this market development, with the most successful of them being acquired by one of the big techs.
  • Building digital business models and integration into digital platforms, superior customer experience, providing microservices incorporated into other industries’ process chains, and unbundling core banking are the main principles to stay relevant.
  • Next-generation data monetization platform a new digital business model and value innovation, a ‘data-as a-service’, the platform creates a holistic and integrated view of customers’ holdings
  • Using an open banking ecosystem, partners and external services can then deliver products to customers as they are developed. Bank customers should receive a personalized and frictionless digital experience across all channels

Greener Banking

Banks can lead the development of more sustainable business models for their customers and drive progress on decarbonization across the whole economy, while at the same time using digital to dramatically decarbonize their own operations.

  • Big data, artificial intelligence, blockchain and the Internet of Things (IoT) now offer a range of ways in which access to sustainable finance can be expanded.
  • Smart technologies can provide insights that can better inform risk assessments directly impacted by climate change, such as flooding, storms and extreme weather.
  • Development of lending policies and approaches that use metrics and targets reflecting broader climate-related ESG and enterprise risks, as well as more traditional carbon risks will be key.
  • A better appreciation of financed emissions and the integration of scenario analysis to review the potential future impact of portfolios will give banks new opportunities through the green transition. This will allow the development of new products and business opportunities because of market share development in growth markets and ultimately lead to stronger relationships with their clients.

Safer Banking

Every bank must promise protection of customer data. Every bank must achieve regulatory compliance. All aspects of trust and compliance must be assured across the digital banking landscape. This is a difficult challenge in a time where banks are the subject of an ever-increasing number of cyber-attacks. The nature of threats continually and rapidly mutates – and digital security and compliance practices must be designed to anticipate this volatility, ideally with the following components in place:

  • Cyber risk management: Putting in place a comprehensive policy that covers effective Business Continuity Management and enterprise-wide governance.
  • Cyber security advisory: Integrating every element that relates to security processes within a complete security architecture, with full integration of IT and Operational Technology, ensuring that sensor information is also managed and protected.
  • Cyber operations: Keeping the entire IT environment secure, based on a Security Operation Center (SOC) and incident and event management.
  • Insider threat protection: Effective methods for ensuring that data is not lost as a result of internal attacks, routine migration, or any other factor.
  • Secure cooperation: Bringing the additional level of physical security that only integrated encryption technologies can offer, including biometrics, Public Key Infrastructure or use of cards and tokens.
  • Digital identity & access control: From outside and within an organization, the greatest danger often comes from unauthorized access.
  • Quantum Computing promises to break traditional combinatory analysis limitations, bringing advances in risk analysis and high frequency trading within ten years

Atos Journey 2026 and the Banking sector (Unlocking virtual dimensions)

Atos has developed research insights in its paper, Journey 2026, which reviews technology driven trends that are expected to shape the evolving world of business and society.

Banks play a unique role in helping people to live safely and prosperously. And now the sector is pivotal in enabling businesses and communities through sustainable finance to transition to a net zero economy. The adaptability and innovation that characterizes this sector will help to power progress for society over the next decade.

In changing world, the opportunities that technology and virtual dimensions offer are causing organizations and society to fundamentally rethink how we perceive value, identity, processes and even purpose.

Ecosystem platforms will facilitate trustful exchanges of data, services, and value. Banking will continue to shift to digital banking platforms and be integrated seamlessly into multipurpose platforms and other industries’ value chains.

For business leaders, leveraging these opportunities and addressing the risks will be critical to value creation on the journey to 2026. In an accelerating, fast-changing world, mastering the key trends will not only be essential to maintaining relevance and resilience, but it will also be the fundamental means of avoiding digital dissonance and disparity.

It is essential to understanding how we effectively and safely manage the ways of negotiating and crossing the physical/digital divide. Major concerns include the complex inter-relationship between regulation and digitalization; growing cybersecurity risks (notably, the rise of autonomous AI cyberattacks); maintaining operational resilience; and the collective impact on how we think about corporate and citizen digital responsibility – including sustainability and decarbonization.

These questions must be answered by every industry sector, especially sectors such as banking and finance that will be most impacted by digital change. Atos can enable banks to move forward in their digital transformation journey to help create a cleaner, more inclusive and secure future for all.


QR Code Payments to Link Malaysia, Indonesia, Thailand, Singapore, Philippines – Bloomberg

Why Atos

Digital transformation sits at the heart of the Atos proposition for its banking clients. We’re driven by a sense of urgency; a thirst for business innovation; and a commitment to minimizing risk. Our banking solutions will guide you through the four realms of digital transformation.

Customer experience – We combine analytics, customer profiling and more to give our customers and theirs experiences that are tuned in to their digital lifestyles.

Operational excellence – Process, resource and investments are examined and implemented to drive down costs and boost productivity.

Banking reinvention – We help create innovative business models to deliver new services and business alliances.

Trust and compliance – Trust and security will continue to be fundamentals of banking and Atos solutions.

Contact Us

Herman Chan

Herman Chan

FSI Head, Hong Kong

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