By Nicole Jucker and Nan Chen, Junior Project Managers
On May 20th, we hosted the 9th event of our Future of Money series titled Neobanking. A buzzword in the FinTech community, it has been taking the spotlight for digital banks in the news and media on the global level. With a strong viewership, a great panel discussion and an insightful presentation held by Tyler Aveni from the Fintech unicorn WeBank, this webinar gave a great introduction and insight into the present and future of Neobanks in China and Switzerland.
In the last few years, we’ve seen a massive shift in the finance industry as digital payments are emerging at large scale. Customers are moving away from physical banks and physical cash towards online banking and wallets. A Neobank is a kind of digital bank that offers digital or mobile-only financial services. Rather than locating physically at a specific location, neobanking is entirely online. Neobank can provide the fluidity and the easy accessibility that traditional banks cannot.
Setting the tone, Tyler Aveni gave us an excellent presentation on WeBank: The World’s Leading Digital Bank. He started with a general introduction of WeBank as an affiliate of Tencent and its rise in late 2014. This followed a description of WeBank’s Propositions for Open banking, which includes Open Platforms, Open Innovation and Open Collaboration by referring to the Wechat wallet feature for credit loans (that can only be seen by a certain whitelisted group of people) as well as the WeBank app. Tyler presented WeBanks three main businesses, Direct banking, API Banking, and Mass Banking. He then gave us a quick introduction into the ABCD strategy and how their Chat Box can handle about 98% of the inbound inquiries. Lastly, Tyler wrapped up by presenting the Pursuit of Technological Enhancements and their drive for strong results.
Subsequently, our Moderator Jonas Thürig, Head of F10, FinTech Incubator & Accelerator (Singapore) took over and led us in an interesting and informative panel discussion with Prof. Dr. Peter Schwendner at ZHAW School of Management and Law, Prof. Michael Sung at Fudan University and Marius Virmond, Director of Financial Services at Deloitte Digital as panelists. Followed by a lively Q&A session where a dozen questions were posed to the panelists.
The panel discussion started with the question whether traditional banks have to fear a high-speed growth of Neobanks and therefore can expect that traditional banks will get leapfrogged.
According to Marius Virmond and Peter Schwendner, the digital banking market in Switzerland is relatively small and Swiss consumers are in general reluctant in switching to digital solutions. They both think that traditional banks in Switzerland do not have to fear Neobanks in the close future. However, in certain areas, Neobanks might be a threat as Swiss consumers won’t likely change their prime bank account, but might create an additional bank account with the advantages of additional convenience and costs saving. Michael Sung on the other side, referred to the fast changes in China and sees potential in hybrid solutions with open banking, where traditional banks adapt radically, go through changes and become nimble with Fintech.
Jonas then led the focus on the challenges of Neobanks such as sustainable customer acquisitions. Some key points were discussed such as generation of revenues per customer and the reliability and ability to compensate when operational risks appear.
The main expectations for Neobanks in the future are seen in gaining people's trust in general, managing customer data smartly, offering investment products, and making use of big data. Neobanks could create higher margins. Lastly, the biggest opportunity of Neobanks is seen in digital assets and to be NEO.
Finally, we would like to express our appreciation to our speaker Tyler Aveni, our panelists Marius Virmond, Professor Peter Schwendner, Professor Michael Sung and our moderator Jonas Thürig for their excellent presentation, the masterful moderation and the great panel discussion. Last but not least, we would like to express our appreciation to our viewers for having participated in the event and for all the interesting questions during the Q&A session!
We trust that everyone has acquired informative insights on the topic. Due to time constraints, we could only present a limited number of questions. If you have further questions for our speakers, please email us at innovation@swissnexchina.org. We will try our best to forward them to the speakers.
Since 2017, the 'Future of Money' Fintech series by swissnex China connected over thousand top academics, startups, thought leaders, regulators & executives from Switzerland & China. This edition was in partnership with Presence Switzerland and in association with SwissCham China Digitalization Committee.
Swiss Fintech will be back in China later this year with Venture Leaders Fintech 2020, co-organized by Venturelab and swissnex China! Stay tuned!
We look forward to seeing you at our upcoming events!
