Southeast Asian Startup Industry Direction in Finance, Education, Health and AI (Part 1)

As a highly developed regional area in digital startups, Southeast Asia is now said to be in the process of strengthening the ecosystem in each category line. The most in the spotlight today is in the financial sector (fintech), in the education sector (edtech), in the health sector (healthtech) and innovations related to artificial intelligence (AI - Artificial Intelligence).

At the Echelon Asia Summit 2017 in Singapore on 28-29 June 2017, several experts and business people discussed the trends and challenges of startups working in these four fields.

Fintech: The trend of payment platforms is not over, and it is based on user trust

One indication of growth in this sector is the unstoppable trend of investment. Fintech startups itself is also growing significantly in Indonesia, from players early stage to those who receive great support from corporations. In the panel discussion held in Echelon, three presenters consisting of Veiverne Yuen (Co-Founder & Managing Director of Tryb Capital), Valenzia Jihsuan Yep (Founder & CEO of PolicyPal) and Anson Zeall (Co-founder & CEO of Coinpip).

The theme presented is fintech's step forward after dwelling on payment-based platforms. However, Anson Zeall, the development of payment platforms in the Southeast Asian market is not over yet. Innovation will continue, as the market begins to be educated and shifts to cashless society. In some countries it is stated that the dominance of payment is still using cash, even worse non-bankable society also still found.

From the current journey of fintech startups – including in Indonesia – there are two major tendencies in their vision, namely to become a financial institution and develop technology that can be distributed in society and industry. According to the speaker, it is precisely these two things that will determine what fintech will be in the future and what it will be like.

"Most of the financial services, at least 85% are not made in the consumer sector (B2C), but in the business sector (B2B)," Veiverne Yuen.

On the other hand, trust is still the industry's struggle to communicate with potential users. From her experience with PolicyPal, Valenzia Jihsuan says, “It's about building trust and being there whenever they need help.”

To support it, the involvement of regulators is needed. One that has been practiced is obtaining accreditation from the local Monetary Authority of Singapore (MAS) – OJK, as part of validating validation that can be shown to consumers.

For most of its users, fintech has become a new way of doing many transaction activities. Money is a sensitive thing, in the sense that a new person will want to put the money he has when he believes that he will find success in the transaction. Regarding this belief, the panelists considered that it is an important thing that must be fundamental in fintech, both in the short and long term.

Blockchain was also mentioned in the panel, with the benefits provided include portability, accountability and potential outside of fintech. One of the best practices today – as part of getting used to the processes in it – data validity can be served as the most important part of the blockchain. Meanwhile blockchain is great for monitoring and validating transactions running on it.

However, technically speaking, for example, in fintech for insurance services as provided by PolicyPal, it is not easy to apply blockchain to it. The challenge is on data protection which is a crucial part of business processes. However, it is possible that in the future, innovations will help push blockchain as an important part of fintech in Southeast Asia.

Artificial Intelligence: The hype is huge and the majority idea is still very conceptual

In session "Hype or Hope and Is there an AI bubble?" there are Annabelle Kwok (CEO of SmartCow), William Klipgen (Managing Partner of Cocoon Capital) and Jarrold Ong (Co-founder & CTO of SWAT).

With regard to the question of whether AI is just hyping simply, each panelist has a different argument. Annabelle for example, at this moment she saw hyping which is so remarkable for AI, but that doesn't mean there's a lot of hope that will definitely be achieved with it.

On the other hand, Jarrold Ong and William Klipgen, have a different opinion. That AI is not just hyping only. However, there are still many challenges that still need to be made clearer. As William said, there are still many investors who find it difficult to understand how deeply AI is embedded in a technology. The AI ​​here clearly provides value, but the challenge from the investor's side is determining how much hyping available and how much it is worth.

“Singapore (and Southeast Asia in general) has less innovation and more technology applications, more AI innovation is happening in Silicon Valley,” Klipgen said.

In practice, Jarrold Ong explained that for some products, there is no need to be forced to use AI. In a sense, in the system as a whole AI only needs to be applied to what is really needed. Because basically when AI is elaborating on a service, the data capabilities will be tested there.

The biggest question is, when it comes to AI, startups will be in direct competition with big players like Google or Microsoft, with huge investments in these divisions. According to Klipgen, a metric to measure a company's product intelligence could be a potential business proposition. The applications brought to the industry are highly customizable, demonstrating that they have a strategy for solving significant problems.