Collaboration key in Asia's fragmented payments space
A growing range of emerging payment types and technologies is delivering greater efficiency, more transparency, and data-driven insights to corporates. However, treasury teams need to capture the opportunities and manage the risks brought on by real-time payments, digital wallets, central bank digital currencies (CBDCs), stablecoins and cryptocurrencies, according to a new whitepaper by HSBC called A new payments paradigm.
Speaking last week at Money 20/20 in Bangkok, Vincent Lau, director, global head of emerging payments, global payments solutions, Asia Pacific, told CorporateTreasurer: “There is still lots of fragmentation in the payments space in Asia and collaboration is very important. It is not a competition, and we will need to work together when it comes to artificial intelligence (AI), fraud etc, especially as things become more concentrated.”
Lau added: “We also need to bring corporates onside, and also more regulators and other industry players. There needs to be more public-private partnerships moving forward, for example the HKSTP in Hong Kong.”
One example of such collaboration is HSBC signing a memorandum of understanding (MoU) with the Thai Fintech Association at the event, to help the bank engage with fintechs in Thailand.
Also at the event, Shadab Taiyabi, partnerships and ecosystems lead, office of the CEO, Singapore, HSBC, said: “The number of fintechs may reduce as the ecosystem matures with ones offering more scaled solutions. We are working on emerging technologies such as Generative AI (GenAI), blockchain as well as quantum computing, and often work alongside many organisations, including fintechs.”
Taiyabi added: “Quantum computing is still emerging, and easily around four to five years away from full commercialisation. Its use cases include fraud detection, portfolio optimisation as well as market simulation.”
Another initiative from the bank is using blockchain to help shorten payment times and digitise the market for a property developer in Singapore. It was a complex assignment given the number of companies involved in the transactions across the supply chain, for example needing to pay insurance claims.
Lau said: “We have been investing into helping enterprises use the blockchain for payments, and we are hoping to rollout a pilot in Singapore for a property developer to other countries and industries.”
Treasurers of strategic importance
While the world of payments is becomes more complex, there is no choice but for treasurers to keep pace with the changes.
“For many companies, the treasury department has become more strategic because it has been moving at pace to seek out efficiency using technology,” said Lewis Sun, HSBC's global head of domestic and emerging payments, global payments solutions, in a statement. “It is imperative for corporate treasurers to keep abreast of the latest developments in the payments landscapes so that they can stay one step ahead, reaping benefits while mitigating risks.”
While cashless transactions are generate huge amounts of data that can provide valuable insights, corporate treasurers shold ensure their teams are properly trained and equipped so that they can harness and use the data, the whitepaper said.
Sun continued: “Corporate treasurers should proactively educate themselves on the value emerging payment trends and technologies bring to their organisations. Embracing digital solutions requires collaboration with banks and fintechs, and corporate treasurers can help enhance their organisations’ competitive advantage by cultivating strategic partnerships.”
In another pilot, HSBC tested the issuance, transfer and redemption of tokenised deposits in intra-group payment transactions with a financial services company.
