How is Bank of China Singapore applying China's system in Singapore's cashless push?

The bank has partnered up with local e-retailers and is developing mobile and smart POS terminals.

With China being the global leader in mobile payments, it offers several key learnings that Singapore can use for reference as it builds a cashless and cardless society. Bank of China Singapore’s deputy general manager and deputy country head Wang Fang tells Asian Banking & Finance what key lessons Singapore banks should consider to support the lion city’s goal to create a digital economy.

What can Singapore banks learn from China’s cashless economy to build Singapore’s digital economy?
With the fast growing cashless trend in China, we have identified the following aspects for reference:

To build an “Internet Thinking” culture, which represents connectivity at anytime, anywhere to anyone so as to create and capture customer value, involves having customer centricity, internet technology, and a digital experiential mindset.

To replicate the rapid rise and acceptability of an aggregated payment mode will mean creating a demandbased payment ecosystem whereby a common integrated platform is created for all card schemes, customers, merchants, and the financial institutions.

Low cost of infrastructure and development has allowed fintech companies to participate in the mobile payment growth with low barrier of entry. What used to be a competitor to the banks are now collaborating to create an ecosystem allowing cross-border joint collaboration and interoperability amongst players.

Learning from Tencent’s startup experience, banks can consider collaborating with social media companies to grow the customer base and subsequently add on payment platforms once the customer base has grown substantially. We must create a constant engagement and sharpening of technology capabilities with a customer-first mindset to create a demand-based solution. 

To create an ideology of “smartphone is all you need for your purchases—anywhere, everywhere, anytime”. This will mean creating a holistic and fully integrated tech-solution to pay for everything that can replace cash, with a dedicated focus on offline and online POS merchant acceptance.

How is Bank of China Singapore pushing for the citystate’s pursuit of a fully cashless society?
Bank of China (BOC) fully supports the Singapore government to push for a cashless society and we recognise that it is an essential revolution in “financial technology innovation.” Recently, The Association of Banks in Singapore launched PayNow, a good example of a cashless payment innovation in Singapore which BOC is proud to be one of the nine participating banks.

BOC benefitted from China’s rapid development in fintech, and we will be introducing cashless payments as part of our participation in Singapore’s Smart Nation initiatives. BOCSG has launched a co-brand Mastercard credit card with Singapore’s largest online retailer Qoo10 in May 2018. This marks the first-ever partnership between a bank and e-retailer locally. There will be more of such innovative products and services in the pipeline, such as new-to-market mobile point-of-sale (Mpos and Smartpos) payment terminals and providing international financial services in crowdsourcing for e-commerce merchants.

How are you leveraging the strategy of your main bank?
Guided by Bank of China’s strategy of “Build Bank of China Into A World-Class Bank in the New Era by Persistently Enabling Advancement through Technology, Driving Development through Innovation, Delivering Performance through Transformation and Enhancing Strength through Reform,” BOCSG has implemented a series of action plans:

An Innovation Committee (governing body) is set up in the bank to oversee and provide guidance and approval on innovation development and projects. We have also strengthened our cooperation and exchanges with MAS, universities, leading internet & fintech companies to promote innovation and development of fintech.

BOC will be launching an Innovation Lab in Singapore this November, focussing on driving innovation and investment in fintech. This is BOC’s first global innovation centre to showcase the innovative ideas and technological development that the bank has embarked on.

We have experimented with the use of big data, artificial intelligence, blockchain, and mobile payment, and commercialised some of these solutions. In Singapore last year, we became the first bank in Singapore to launch a cross-border UnionPay e-wallet for QR code payment, which can be used in over 5 million merchant outlets in China and with worldwide acceptance.

BOCSG is also currently working with Mastercard on the launch of Mastercard QR in Singapore. This is expected to make a bigger impact on changing the payment method in Singapore. With Mastercard QR implementation, the use of smartphone to make payment will be more than cash and/or card. Mastercard QR can be used anywhere in the world that has Mastercard QR acceptance.

BOCSG will continue to enhance and innovate its payment platform to provide a suite of market leading payment products, beginning with the upcoming re-launch of the mobile banking application which will provide a holistic banking solution to its customers. In support of Singapore’s drive to be a cashless society, the bank aims to provide consumers and merchants with one-stop financial services through product development and technological enhancement. This will help develop a new payment ecosystem for consumers, merchants, and the bank, which will further improve the customer journey with BOC.