DigFin heard 10 fintech pitches at an event organized by Accenture and Cyberport, the tech incubator backed by the Hong Kong government. Of course, a five-minute presentation can’t go below the surface, but there were no duds (which is not always the case with these things).
Startups continue to innovate across the breadth of financial services: insurance, capital markets, regulatory reporting, wealth management, and digital assets.
There are even new ideas from the world of payments, which, as Cyberport’s head of fintech, Victor Yim, pointed out, is widely believed to have matured.
As there were few apple-to-apple comparisons – what might interest a bank may not interest an insurer or a Web3 investor – it’s hard to say which pitch was best. Also, some people are natural presenters (and English is not always their native language). Nonetheless DigFin offers up a few thoughts.
Two startups presented. One, Divit, is a credit-card killer. The other, krip, is a credit-card enabler. Both have a good story, although DigFin reckons it will be easier for krip to get serious backing – banks or a big payments processor will be keen to work with a fintech that can promote more card usage.
Divit works with airlines to encourage consumers with air miles and other rewards to make purchases at other merchants using FPS, the Hong Kong mobile Faster Payments System. Promotions such as free miles get people to start paying with FPS (ie debit), and once consumers start, they get hooked.
Merchants like this because they save on transactions by avoiding card fees, and because the app targets frequent fliers, who tend to be affluent. Divit’s co-founder, David Yu, claims some merchants see up to 60 percent of their customers eventually switch to FPS. Customers paying with the Divit app (linked to FPS) also enjoy instant settlement and real-time downloads of rewards.
Divit’s challenge is getting people to understand the benefit of downloading the app, although it helps that Cathay Pacific is a partner.
Krip’s pitch, on the other hand, is immediately intuitive. Founder David Wang explains krip centralizes users’ credit card deals, offers and rewards. Few people have any clue of what their entitled to by rewards programs, and in Hong Kong there are more than 6,000 of these.
Wang says 95 percent of deals are unknown to consumers, mainly because no one remembers what a company advertises when they step inside a store. By aggregating the programs into a single app, people can see what kind of discounts they can get. And people love a deal.
This can drive more traffic to those merchants, provide more fees to card issuers, and make reward programs more important, especially as the krip APIs personalize what’s available from an individual’s card profile.
The startup has a consumer app, and has partnered with livi bank (a virtual bank). The simplicity of the idea has enabled it to accrue 70,000 retail app downloads.
Both Divit and krip face challenges of scaling beyond Hong Kong. That requires funding and partnerships, to amass the airline partners or crack a new market’s credit-card data. If krip can get enough card networks, the app sells itself, although DigFin wonders how easy this is. Divit’s value is tied to finding airlines willing to work with it, which could bring some operational headaches as well.