If you can’t beat them, learn from them.

Big bosses at Singapore’s three largest banks are losing sleep over the rapid rise of financial technology startups in the city-state. Startups are unravelling the financial services value chain not only in Singapore but also across the region, and traditional lenders are scrambling to find way to minimize the damage wrought by their competitors.

“Fintech start-ups are beginning to attack various parts of the financial services value chain. In such an environment, our future success depends on our ability to harness the digital revolution and completely re-imagine the banking experience,” noted DBS Chairman Peter Seah and CEO Piyush Gupta in a letter to shareholders in the group's annual report.

“Fintechs are beginning to unravel the financial services value chain, and we need to be able to respond,” Seah and Gupta stated.

This sentiment was echoed by OCBC's Chairman Ooi Sang Kuang and Group CEO Samuel Tsien. In a similar letter to shareholders, they noted that the bank is closely watching the rise of fintech startups, as they have the ability to disrupt traditional banking practices.

In order to counter the rise of the startups, the lenders are rolling out initiatives to incorporate fintech into their operations.

For instance, OCBC established a new FinTech and innovation unit called The Open Vault, which will collaborate with startups to drive the formation of innovative business models and solutions.

Meanwhile, United Overseas Bank (UOB) set up The FinLab venture, which explores possibilities with FinTech startups through prototypes in payments and collections, wealth management, big data analytics and risk management.

As for DBS, the bank was first to incorporate hackathons into its talent development programme, where employees work with start-ups to create prototype mobile apps to address business problems.

"This enables them to gain exposure to the fintech culture, agile methodology and other digital working concepts. In all, the bank is running over 1,000 experiments, giving our people the exposure they need so we can innovate as a bank," Seah and Gupta noted.

Experts suggest ways to turn negative feedback into positive.

In an online era where everyone seems to be engaged in using social media, whether for personal or business, even the littlest details of a mess can rapidly spread and get out of control.But if a company is prepared, it's a lot easier to save its reputation and come through a crisis.

Singapore Business Review spoke with some chief marketing officers to talk about their respective social media crisis management plans and their thoughts on how to best respond to negative feedback and turn it into a positive.

All but one is cheaper here than in HK.

Love is free but there is a cost to express it.

Through data from Expatistan, a price comparison site for the cost of living across the globe, Singapore Business Review compiled latest figures for basic activities that couples may decide to do during the Valentine's Day. This includes data ranging from the cost of a cheap meal for two in the neighborhood to the best available seats for two in movie houses.  

Here are their top 10 destinations and average spending per night.

Online hotel search trivago.sg reveals the top 10 cities Singaporeans were choosing for the 2016 countdown and just how much they were willing to spend on accommodation compared to international travelers.

Based on travel search data on trivago.sg, the most popular way to celebrate the coming of New Year was a getaway at one of the country’s hotels, where Singaporeans were willing to spend on average $334 per night over 2 nights. In comparison, international travellers spent on average of $352 per night over 4 nights for their New Year’s countdown in Singapore. This was 5% more than what Singaporeans pay for hotels in the country and double the stay duration. Nonetheless, Singaporeans were still willing to splurge on staycations for this occasion, spending the most in Singapore for hotel accommodation than any other Asian destination in the top ten.

Here’s the complete list of 10 top destinations for Singaporeans to celebrate the coming of New Year:
 

Number 7 is helpless.

Those crisp white sheets, well-stocked minibar, and concierge service. You are on a holiday and all you want to do is to kick back, enjoy the champagne, and live the high life. The doorbell rings and the slew of irritations bring you back to reality. Intrigued by your exasperations, global travel search engine Skyscanner dug deep and found the 8 most exasperating hotel hassles travelers may encounter. Read on to see if you agree with Skyscanner.

More tech could mean job variety.

Will there be fewer jobs in the future? Not according to recruiting experts Hays. It argues that robotics and technical innovation will not spell the end of many jobs as we know it, but will instead help make us more productive and create new types of work and jobs for the future.

“Equally, the advances in data science and artificial intelligence are opening up new ways to look at businesses and generating insights that can lead to major productivity improvements. I'm investing in those areas in my own business, but to best equip people with the tools to do a better job, not to replace them,” says Hays’s CEO Alistair Cox.

Cox believes that businesses will need people as much, if not more, than they will need robots. Hays shared 5 jobs of the future in Singapore as a result of the rise of the robots.
 

Singapore government won US$20,000 grant to investigate the issue.

Imagine Singapore as being free from traffic jams and smog a few years from now. Commuters are walking or cycling to much extent while electric bicycles and hydrogen-powered vehicles have become common modes of transportation.

It might sound impossible as of the moment, but the Urban Land Institute (ULI) Singapore will soon be investigating the possibility of a car-free future in the city after the national council won last month an ULI Urban Innovation Grant to rethink the future of urban mobility in the City state. The US$20,000 grant, which was awarded at ULI’s annual Fall meeting, is given to submissions that recognize or launch innovative public/private partnerships and advance the responsible use of land in building healthy, thriving communities worldwide.

ULI Singapore’s submission "Disrupting Mobility - Car Share Singapore: Urban mobility options for future cities” aims to rethink the future of urban mobility. Although Singapore has been a leader in urban transportation mobility, it still devotes significant amount of its limited land and resources to building roads. Roads already account for 12% of the city state’s land area today, only a little under housing, which takes up 14%.

Scott Dunn, Vice President, AECOM Southeast Asia and ULI Singapore Executive Committee Member told SBR that a car-free future in Singapore is possible as it has all the elements that could lead to the first 100% public transportation system. More realistically, Dunn added that the immediate future is probably more around car-sharing, alternative types of engines such as electric, hydrogen-powered and advancement in technology such as autonomous vehicles (cars & trucks) leading to better road safety, efficiency of the road corridors and reduction in carbon output.

“Would this then lead to a completely shared economy around mobility for Singapore? Our study should help lead to an answer,” he noted.

However, Dunn cautioned that while there is the basic need to move people and goods around Singapore in a safe and efficient system, the main challenges to reducing personal car use include government income from COE and import taxes and the current state of the public bus and rail network which would need better coverage and capacity.

Dunn added that challenges related to human behavior for automotive enthusiast meanwhile include the personal freedom of transportation options and the commodified status symbol which a vehicle represent.

Over the next few months and using the downtown Marina Bay development as a model, ULI Singapore will team up with the Center of Livable Cities (CLC) to hold workshops. ULI Singapore members, sector experts and a variety of public and private stakeholder groups will be consulted on the implication of car free neighborhoods, car sharing and autonomous cars on livability in Singapore.

During the workshops issues such as the impact of car-free lifestyles on the urban framework, on livability, on economic viability and real estate outcomes will be addressed. The joint report will be published in July 2016 at ULI’s World City Summit 2016 and shared at the ULI Fall meeting towards the end of the year.

More than half of the museum was updated from Oct19-30.

Singapore Business Review is amongst the first few privileged ones to visit the newly revamped Trick Eye Museum Singapore at Resort World Sentosa. Billed as the first 3D Museum in the city-state which first opened on June last year, Trick Eye Museum has undergone a major renewal from October 19-30.

More than half of the museum was updated with new artworks, themed zones and a new 4D concept.

Experts uncover the degree of threat for banks.

In a recent interview with SGX, DBS CEO Piyush Gupta shared that the biggest threat facing the banking industry is not the risk of bad loans, aggressive competitors, or capricious economic cycles, but the rising competition from outside the traditional financial sector.

The likes of Alibaba, WeChat, Apple, Tencent, and Google offering financial services, predominantly around payments, he said, are disrupting the value chain in finance. He even warned that if banks do not respond suitably, the industry is in danger of becoming obsolete.

Asian Banking and Finance gathered some views from experts and emerging fintech firmshow banks can turn this threat into opportunity through strategic partnership.

Here’s what they had to say:

Tom MOUHSIAN, KPMG’s Head of Customer & Growth Practice for the ASEAN region

Obviously, digital disruption creates discomfort to traditional incumbents. It forces them to respond with agility to increasing levels of digital innovation, protect and defend the status quo and take countermeasures. However, with disruption comes Opportunity.

The commercial scale of the disruption in banking has not yet reached the scale to wipe out current players, but they are certainly shaken up. In today’s digital age, banks can easily see new digital solutions and concepts that are coming into the market and there is no one stopping them from taking appropriate actions other than themselves.

Not everyone has to be an ‘inventor’ and there is absolutely no shame in learning and leveraging in others’ skills and creativity.

This can mean learning to design customer-friendly functionality and user experience, building real-time and virtual customer service capabilities, personalising content of marketing campaigns, customising product features and pricing to fit individual needs, adopting new technologies and product ideas, absorbing vast amounts of external and internal data to produce informed actions, etc. None of these things are controversial or new.

The problem here is, banks are not quick enough to realise the value in developing such capabilities earlier, before they become focal points of externally led disruption. Bank who fail to catch up with digital disruption will thus lose out. On an optimistic note, banks have huge advantages, such as their established market presence and capital resources – things that start-ups have to establish from scratch.

Banks that embrace disruption now, while it is still not too late, will emerge as stronger organisations than they are today.

Gerben H. Visser, Co-Founder, The Singapore FinTech Consortium

Finance Technology (FinTech) has over the past few years been emerging from the “grass root” start up ecosystems into receiving signifcant awareness and more recently obtained traction within both the financial services industry at large, as well substantial attention from the respective government and regulatory agencies.

In our opinion, these emerging FinTech innovations and developments, should not be treated by the Banks as a threat, or approached in reactively manner with a defensive persepective.

But rather perceived as an multitute of opportunities to address some of the bankings’ core challenges and by act proactively the Banks should be able to capture untapped or underserved customer segments, launch more elegant online & mobile products and services and migrate legacy IT systems to more cost effective and flexible processing paltforms.

The financial sector had already previously relied on technology to bring new products to market. For example, the introduction of the ATM in the 60s represented a change of the way customers managed their financial lives. However, since 2008 the rate at which technology is being used within the financial sector has dramatically increased.

The boom of the FinTech sector can be explained by different factors. On the one hand, public trust in financial institutions has sharply diminished due to the economic impact of the financial crisis on businesses and households.

On the other hand, banks were faced with a more onerous regulatory framework which diverted their resources towards compliance, instead of delivering innovative and customer-centric solutions. Technology companies have leveraged on the opportunity arising from the public demand and the incapacity of banks to adapt quickly.

They entered the market by offering near-perfect substitutes to financial products that were otherwise historically provided by banks (e.g. loans, personal current accounts, currency transfers). However, and most importantly, the

FinTech industry can do so at a price point and via channels which are in line with new customers’ behaviour and the expectations of a digital age, something banks had difficulty in doing.

Aung Kyaw Moe, Founder and CEO of Southeast Asian payments company 2C2P

There is a narrative of an on-going and accelerating battle between Silicon Valley versus Wall Street. The trend is clear - financial technology companies are putting traditional banks under pressure.

Banks and financial institutions won’t die out – they will adapt and evolve. If one looks at the operations of a bank, there is in fact not much that is proprietary. Technology, software and back-end processes are typically provided by an external vendor.

Ultimately the customer will pick what’s a) most convenient, and b) what’s well available through their social networks. It could be a bank product, or it could be a non-bank vendor product, like a P2P money transfer app, for example.

As these vendors command more and more influence, they will erode the banks’ business.

Ultimately the biggest winners are consumers. Banks will enter into strategic partnerships with technology companies, chiefly because we are not hamstrung by legacy technology, regulations and other constraints, in turn improving the quality of service for customers as well as providing more convenient banking channels and products.

2C2P works with a number of banks, providing technology, innovation and expertise to banks, who in turn offer them to their customers. We are viewed as a collaborator and a strategic partner, and not really as a competitive threat.

Banks in developed countries (example Japan) are already collaborating with emerging FinTech companies to provide loans, infrastructure, factoring services and etc.

Vince Tallent, Chairman & CEO, fastacash.

Disruption is the status quo in almost every industry, even in banking and financial services. There are multiple players (be it the likes of Apple, Tencent, Google, or messaging and social apps or newer fintech players) who are expanding their position to deliver fintech services that better meet the needs of the consumer – currently these players are addressing single services but are expanding quickly to offer broader services.

Banks and financial institutions today have the benefit of sharing a trust with their consumers.

Banks need to capitalize on this while innovating and digitizing their services. That said, speed is critically important. Banks have typically tended to move slower due to their international decision making processes.

Tech companies move faster and understand what end users want from the perspective of the user’s experience – with our technology and focus on building an engaging user experience – we really make a difference – and deliver speed and reduce time to market for our partners.

We work with leading banks and financial institutions to help them to innovate and leverage social and mobile behaviors of consumers to deliver social payment services.

What Piyush Gupta’s comments reflect is that DBS’ leadership sees the need to adapt and innovate – providing their customers with the most convenient services possible. Such foresight is crucial to their competitiveness.

While banking is a few hundred years old, the industry has started the process of reinventing itself – most notably in the past decade.

Increasingly, we are interacting with our banks through online or mobile channels – the banks are beginning to offer more services through our mobile phones so that we can use our phones for services beyond checking bank balances, transferring money, etc.

What we have seen is that banks want to “innovate” as long as they are second to market –the tech companies have shown is that there is no time to be second. Piyush Gupta's comments about being completely irrelevant to customers' needs in the next 5 to 7 seven years is absolutely right if banks don’t innovate, but given the pace of change it will happen much sooner.

Case in point: my children – daughter (22), and my twin sons (16) will never step into a physical bank branch. They haven’t even heard of brands such as Natwest or Western Union. They have, however, heard of Whatsapp, Facebook, Viber, Skype, etc. Social and messaging apps are where the 16-25 year olds are living and breathing.

So there’s an opportunity for banks and FIs to work with the likes of a messaging app such as Whatsapp, WeChat, etc., or with other innovative technology players like fastacash that are able to bring social and messaging to payments. Time will tell which banks are embrace a partnership model with innovative tech companies and which banks only talk about doing it.