Accelerating digital transformation in the ASEAN region

Experts are predicting that the COVID-19 pandemic and related measures will serve to accelerate digital transformation strategies at commercial financial institutions across the Association of Southeast Asian Nations (ASEAN) region. This is largely due to the fact that consumers tend to prefer convenience and perceived safety during times of crisis. As such, well-established and digitally-advanced incumbent financial institutions are likely to be in the best position to benefit from this, at least in the short-to-medium term, as they will be poised to gain more customers as well as save from improved efficiency and reduced costs.

Most major commercial financial institutions across the ASEAN region have reported a surge in online banking activity since the onset of the pandemic. For example, Bank Rakyat Indonesia reported an increase of 88% in internet banking in the first quarter of 2020 (as compared to the same quarter in 2019). This, coupled with the greater adoption of open banking architectures, will force financial institutions to innovate more quickly or risk falling behind and ultimately failing.