What Germany Can Learn from Fintech in Asia: A Report

This report provides a comparative analysis of the fintech landscapes in Asia and Europe, with a specific focus on what Germany can learn from the successes and strategies employed in the Asian market. The introduction outlines the key similarities and differences in how fintech organizations operate in Asia and Europe, including aspects like capitalisation, regulatory approaches, and technological adoption. The report then identifies key drivers and characteristics that distinguish Asian fintech companies, such as their customer-centric approach and sustainable business models, from their European counterparts. The core of the report suggests that Germany and the broader European market can benefit from replicating the regulatory and operational strategies of Asian fintechs, particularly the approach to regulations and the use of technology. The report concludes by summarizing the key findings and emphasizing the importance of adapting successful Asian fintech strategies to enhance financial services in Europe. The report includes a list of references to support the analysis.

What Can Europe
(Germany) Learn from
Fintech in Asia?
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Table of Contents
Introduction......................................................................................................................................1
a. Key similarities as well as differences in the ways in which fintech organisations operate in
Asia and EU............................................................................................................................1
b. Key drivers possessed via Asian fintech organisations that lacks in EU...........................1
c. Which key driver from Asia can be scaled as well as replicated within the EU experience2
Conclusion.......................................................................................................................................2
References........................................................................................................................................3
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Introduction
Fintech (Financial technology) refers to new products, processes, applications and even
business models within the financial service industry that compose of one or more than one
complementary financial services via end-to-end process via internet (Berg and et. al, 2020). The
report will provide an overview of different aspects that prevails in between Europe and Asia in
the ways Fintech companies deliver their functionalities.
a. Key similarities as well as differences in the ways in which fintech organisations operate in
Asia and EU
The European banks are undercapitalised whereas Asian banks are overcapitalised.
Western along with European banks are hit due to financial crisis which has increased capital
cost and have made different assets to shed as well as formulate large capital pools. Technology
is required for enhancing systems, replacing inefficient platforms and creation of revenue
streams. GFC have lead to push talent within the entrepreneurial market due to which successful
organisations have made come back (What’s the Difference Between Asian and European
FinTech?, 2021). In case of Asian fintech companies, banks have not been affected dramatically
via GFC and DBS is one the example who is making profit from 15 years. Furthermore, western
banks are challenged to opt for alternative financial platforms along with payment gateways.
The Asian Fintech companies opt for top-down approach via regulators and on the other hand
Germany have opted for bottom up approach that makes the difference. Like in Europe FinTech
are liable for identification of problem and solve this via usage of some technologies.
In context of similarities, the regulations in European countries are strict and stable like
in Germany emphasis is made on data privacy and bringing in innovation. Here, sandboxes are
created via local as well as European government. In case of Asia, each country have their own
laws, regulations and practices. Like in Malaysia and Singapore emphasis is laid on creation of
sandboxes and organisation of conferences.
b. Key drivers possessed via Asian fintech organisations that lacks in EU
Asia is Ant Financial across the world with their Fintechs having value of 2.5 times
which is more than others across the world. $150 is valuation of Ant Financial which makes this
more valuable (What is the Fintech Landscape like in Europe, the USA and Asia?, 2020). The
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countries vary in context of literacy, education and digital adoption that implies that Fintechs
across Asia are different in the ways demands of customer are addressed, and fixing local issues.
Here, companies opt for converting and partnering with their existent customers instead of
building up new bank from the base or ground. This implies that business model that is being
adopted by the Asian Fintechs is more sustainable rather than making investments on acquisition
of organic consumers. This implies that a lot of money is not wasted on acquiring customers but
emphasis is laid on being profitable (Pranata and et. al, 2020). On the other hand European
FinTech starts from the ground which implies lots of money is spent on the irrelevant activities.
c. Which key driver from Asia can be scaled as well as replicated within the EU experience
The major aspect on which FinTech organisation in Asia operates, are regulations are
critical assets through which it becomes easy to deliver their liabilities. In this case, Asia opts to
work on the basis of principle that comprises where anything which is not mentioned within the
regulations must not be opted (FinTech 2.0: Europe vs Asia Pacific - Is Europe still the FinTech
benchmark?, 2021). In addition to this, as technology is utilised by the companies then they can
scale them as per evolution of technology in order to have better outcome. Like data analytics
will be rendering great assets to the Asian organisations within conducting analysis through
which better decisions can be made.
The critical aspect that must be replicated within the EU experience is that they tends to
operate on the model that anything which is not mentioned within the regulations is regarded like
a go. For an instance if any aspect is not considered or left out within the rules then European
FinTech organisations considers this like an opportunity that they can opt for. This can be
regarded but it is not necessary that it will only yield positive results and there has to be some
strong reasons that it is not mentioned within the regulations. Thus, it becomes important that all
the aspects are precisely considered before opting them. It would be better that only those
regulations are regarded which are specified within the guidelines and rest must be avoided.
Conclusion
From above it can be concluded that, fintech companies opt for usage of technology for
making their financial services effectual. There are certain aspects where Asian FinTech
organisations are step a head from European FinTech firms and it becomes important that all the
regulations are followed.
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References
Books and Journals
Berg, G. and et. al, 2020. Fintech in Europe and Central Asia.
Pranata, N. and et. al, 2020. CROWDFUNDING FOR INFRASTRUCTURE PROJECT
FINANCING: LESSON LEARNED FOR ASIAN COUNTRIES.
Online
What is the Fintech Landscape like in Europe, the USA and Asia?. 2020. [Online]. Available
through: <https://www.mintcopywritingstudios.com/blog/fintech-landscape>.
FinTech 2.0: Europe vs Asia Pacific - Is Europe still the FinTech benchmark?. 2021. [Online].
Available through: <https://www.linkedin.com/pulse/fintech-20-europe-vs-asia-pacific-
still-benchmark-joseph-toh/>.
What’s the Difference Between Asian and European FinTech?. 2021. [Online]. Available
through: <https://fintechnews.sg/2017/fintech/difference-between-asian-fintech-vs-
european-fintech/>.
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