Paul Schulte, MA, MALD
Paul@schulte-research.com
www.schulte-research.com
(+852) 9705 0777
Developments in Fin Tech and Blockchain in Asia:
Payments, e-commerce, Blockchain & Rideshare: All roads lead to banking.

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Paytm Ant Flipkart Credit
Karma N 26 Kabbage
Alibaba
X X
Tencent
X X
Tiger Global
X X X
Softbank
X X X X
Temasek
X
Turning payments into banking. Softbank and Alibaba dominate here. A land
grab in Asia!! All roads lead to banking. Will US and German players enter?
Source: Schulte Research
Payments -> Banking

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Walmart Tokopedia Lazada
Alibaba
X X
Tencent
X
Tiger Global
X
Softbank
X
Temasek
X
Indo-Pacific Players – Turning Retail into Banking. Alibaba dominates here.
All roads lead to banking. Alibaba dominates in SE Asia.
Source: Schulte Research
Retail -> Banking

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Ola Grab GO-JEK Didi
Alibaba
X (Didi) X
Tencent
X X (Didi) X X
Tiger Global
X X
Softbank
X X
Temasek
X X
Indo-Pacific Players – Turning Ride Shares into Bank Shares. Tencent
dominates here. Watch Grab move into financial services very quickly.
Source: Schulte Research
Rideshare -> Banking

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Amazon has created enviable operations in India & will
reverse engineer this to Asia. Are Asian banks ready?
Source: EconomicTimes, Schulte Research
• Amazon has invested the following SMEs in India to drive more marketplace
sales and facilitate Amazon’s financial services.
Online Payment
Lending
Financing
Insurance
(May 2018)
(May 2018)
(2015)
(2016)
(Apr 2018)
(2015)

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Niche subsidiaries. PRC & US. Get a separate digital
unit! The banks are fighting back. Is this enough?
Company Niche subsidiary Specialization
Millennials
Personal loans
Personal loans/SME
Personal loans/SME
Wealth Management/P2P
Source: Money Live, Infosys, Schulte Research
USChina

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Tokopedia and Paytm digital offerings in banking: Clones of Alibaba. Millennials.
All roads lead to banking.
Source: xxxx, Schulte Research
Tokopedia Paytm
Capital
Loan
Gold
Online
LoansLoan
Payment
Vouchers
Electrical
Bill
Levy
Insurance
Gift
Card Tax
Credit
Card
Loan
Gold
Hot
Deals
Shopping
Foreign
Exchange
Electrical
Bill
Toll
Insurance
Gift
Card
Tax
Credit
Card
SE Asia India
AliCloud

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What can banks do? Digitize now. Get in the middle &
see your biz as O2O. Data is the center.Can You Change?
Source: Schulte Research Estimates
Will Fin Tech swallow the
MBA, CFA, CPA, FSA?
3. Understand Blockchain–
PBOC TRADE FINANCE PLATFORM
2. Get Data Centers
ANT/ ALIBABA
4. W/C, warehouse funding -
AMAZON
5. HUAWEI/ALIBABA
V.
GOOGLE/APPLE?
1. DIGITIZE NOW:
Marcus, Finn, Mybank

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The evolution: Why should banks get involved in lifestyle, utilities, coupons,
voice command, tickets? Of course banks should have been involved in this.
They know more about their customer but never bother to collect the data.
Firm Adver-
tising
Food
Delivery
Tickets/
lifestyle
Streaming
Music
Content
Utilities Coupons Wallet Voice
Shopping
Groceries
BABA X X X X X X X X X
AMZN X X X X X X X X X
WMT X X X X X X X X
HSBC
STAN C

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Blockchain issues: Watch what China is doing

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Tradable
for all
assets
Verifiable
Time stamp
Accountants
beware
Bankers
beware
Middlemen
beware
Insurance
beware
How Blockchain cuts through entrenched cartels: Turn
your physical world into a digital reality ASAP.Millennial
Independence
from cartels
EFFICIENT LIVING
AUDIT
OPEN
SYSTEM
INNOVATIVE
Low
cost
Automated
Decentralized
Crowd
sourced
IOT-connected
O2O hospital/
Doctor/
payment
Triple
entry
ledger
Standard-
setting
Live traceable
audit
Immutable
Source: ‘Blockchain Revolution’, Schulte Research
Provenance,
Safety,
Integrity,
Ledger

BPOC BLOCKCHAIN CHINA:
GREATER BAY AREA
TRADE FINANCE PLATFORM-TFP
Buyer Seller
SME
Individual
Legal
InsureRating
Factoring
Treasury
Loans
Accounting
Guarantees
Storage
Logistics
Customs
Regulators
Tax
Arbitration
AssociationTech Data
1.1st blockchain platform by PBOC
in Sept. W/ BOC, CCB, CMB, Ping
An, Stan C, BYD.
2. Help SMEs, serve real economy,
reduce financing costs using
blockchain.
3. Open, compliant, secure
community. Trading, registration,
custody of assets.
Phase 1: Created regulatory body &
blockchain platform. Supply chain,
A/R, financing, factoring.
Phase 2: Explore more cross-
border trade finance scenarios

POSITIONING OF THE PLATFORM
‣1. "Link data." Ports, quarantine, logistics, warehousing,
associations, data firms.
‣2. "Connect users." A natural ID system that integrates data
sources & brings together applications & users.
‣ 3. “Communicate Policy”. Trade finance blockchain can
communicate & coordinate w/ regulators AND Innovate.
‣4. “Construct Technical platform." Openness & cooperation
w/ banks, 3rd party tech firms, & universities.

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Two issues we need to think about

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PRC:do we need 2 of everything? US: Is the Cold War ‘State Actor’ back?
HuaweiState
Council
MSS
CDB
Alibaba Tencent
ANT (800 mn) WeChat (1 bn)
DoD
CIA
NSA
IN-Q-Tel
Palantir
(Thiel)
Greylock.
Sequoia,
Blackstone
Accel
FlipKart
SEA
OLA
GoJek
Global Blue
Singpost
Lazada
Tokopedia
PayTM
Qualcomm
Apple
Facebook (2.2 bn)
Google (2 bn)
Amazon (300 mn)
AWS
Finance
Ecommerce
O2O
NSC
ATT/Verizon
Tencent CloudAliCloud
* Numbers are users
O2O
Finance
Ecommerce
CCB, ICBC
JPM. Citi,VISA

Quantum Computing digital equivalent of splitting the atom? US,
PRC spending BILLIONS. QC will crack any code in 1 day. 1st mover?
Quantum Future
• Quantum Computer can break 1024 – bit RSA Encryption in 1 day
• Emerging “Quantum Encoding” market now. Quantum Key Distribution (QKD)
• Cybersecurity firm ID Quantique (Korea), startup using QKD to protect data ($65 mn by SK Telecom)
• Cybersecurity marketspace expected to be worth $25 billion in 2025
Example
• RSA Encryption is gold-standard
• Uses two large prime numbers and their product as key
• 1024-bit RSA Encryption: fastest computer would take 8 ∗ 1030
years to crack.
Current
Security protocols are
measured by the time it
takes to “break in”
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Source: Market Research Mediam