Who Is Fintech For?

“This piece of plastic here has saved lives. It was a revolutionary product. I have no doubt about it.”

Years ago, I went to a talk by a top executive from a bank which had proven incredibly successful in pushing for credit card adoption in Puerto Rico. An audience member asked her a pointed question about the role of banks in society and whether her work had social value, especially given the predatory practices that had led to the subprime mortgage crisis. Totally unfazed, she answered that credit cards had made Puerto Rico a safer place by reducing the need to carry cash, consequently lowering the crime rate. The financial technology of cashless payments making society better.

A sound argument, but ultimately one that ignored the larger role banks were playing, making millions off Puerto Rican debt. Fast forward to today, the island is in financial ruin, with more USD74 billion in bond debt and USD49 billion in unfunded pension liabilities as of May 2017. Perhaps not the revolution credit card advocates were hoping for.

Some say that Southeast Asia is in the middle of its own fintech revolution — from peer-to-peer lending to robo-advisors to cashless payments — venture capital keeps flowing into the region, every company wants in on the game, and not a week goes by without some new fintech product being announced at a fancy conference.