In The Top Up this week, we examine the impact of SG-India payment system linkage on industry players and the implications of SVBâs collapse for SEA. [Read from your browser]( The Top Up ðµ Welcome to The Top Up! Delivered every fortnight via email and through the Tech in Asia website, this free newsletter breaks down the biggest stories and trends in fintech. If youâre not a subscriber, get access by [registering here](. Written by Simon Huang
Journalist Hello {NAME} Nowadays, I hardly ever bring my wallet when I go out. While I canât always use credit cards or e-wallets like GrabPay, most shops accept PayNow, the peer-to-peer funds transfer service developed by the Association of Banks in Singapore. Last month, a tie-up between PayNow and its India-based equivalent United Payments Interface (UPI) was announced by the governments of both countries. In this weekâs big story, my colleague Melissa examines the implications of this linkage in greater detail. She considers how much of a game changer this really is, given that fintech players like Wise already allow users to send money between Singapore and India using their respective PayNow and UPI IDs. Still, thereâs potential for a big disruption. For example, Paytm was the dominant mobile wallet in India, but it was later surpassed by PhonePe and Google Pay in terms of user base after both got a headstart in adopting UPI. On the topic of big disruptions, this weekâs Hot Take looks at the fallout from the Silicon Valley Bank (SVB) collapse. Given its limited direct exposure to SVB, Southeast Asia seems like a safe harbor in the current storm. However, the regionâs startups and tech companies should learn from this event, as they may have to deal with the indirect consequences in the months to come. -- Simon
 --------------------------------------------------------------- THE BIG STORY [Winners and losers of SG and Indiaâs novel PayNow-UPI linkage]( The real-time linkage may increase the convenience of cross-border payments but itâs less revolutionary than youâd think.
 --------------------------------------------------------------- THE HOT TAKE SEA insulated from SVB, Credit Suisse fallout, for now Hereâs what happened: - The collapse of Silicon Valley Bank (SVB) - the second-biggest [bank failure]( in US history - earlier this month took just 48 hours.
- This was quickly followed by the closure of Signature, marking the country's third-largest bank collapse. Worries also persist over the stability of other smaller, niche-focused players like First Republic Bank.
- Panic spread to Europe, where Credit Suisse had to be rescued by Swiss arch-rival UBS, bringing an ignominious close to the formerâs 167-year history. Hereâs our take: It has been said that when the US Federal Reserve tightens monetary policy by raising interest rates, it continues to do so until something breaks. That something was SVB, which suffered from an old-fashioned bank run and was taken over by regulators on [March 10](. Two other smaller players, Signature and Silvergate, faced the same fate as SVB. But this wasnât a bank run of yore, with long queues of people waiting outside branches to withdraw their savings. Instead, much of the panic took place online, with [attempted withdrawals totaling US$42 billion]( in just a day - March 9. For context, as of December 31, 2022, SVB had around [US$14 billion in cash]( - the balance was mostly in loans and fixed income securities. Panic spread globally, and fast. Credit Suisseâs largest shareholder Saudi National Bank made ill-advised [comments]( that it wouldnât extend further support to the beleaguered Swiss bank - triggering a fresh wave of selling in its shares and other European lenders. This further dragged down confidence, pushing Credit Suisse into a downward spiral and eventually into the arms of archrival UBS. Southeast Asia seems to be insulated from the drama, at least for now, though Singapore and Hong Kong bank stocks [tumbled]( on Monday amid contagion fears. Between March 8 to March 20, the regionâs twenty largest banks (by market capitalization) shed an average of 4%, according to our calculations. Swiss-listed shares of Credit Suisse, in comparison, had dropped [over 30%]( at one point. While startups and VC firms in Southeast Asia have had [minimal to no exposure]( to SVB, many remain cautious. Nevertheless, the regionâs tech and startup ecosystem wonât be unaffected by whatâs going on in the banking sectors of US and Europe. For one, VCs, companies, or funds that have been directly hit are likely to be even more circumspect when making investing decisions. Founders and investors will also be relooking at their current financial risk management processes. For example, startups may want to diversify their banking relationships to avoid having too much money in any one institution. Larger companies may even consider reducing counterparty risk by putting excess cash that doesnât fall under national deposit insurance schemes directly into government securities, yet that comes with its own challenges. Reliable and well-capitalized banking institutions located in Singapore [may benefit from an inflow]( of money seeking safer âhavens.â The events of the past couple of weeks may also lead to a contraction of credit conditions and a higher risk of recession, affecting demand for products and services offered by startups. Ultimately, there is little that founders can do to shape the macro picture. But there may be bright spots as fintech companies find [creative ways to offer solutions]( to the challenges faced by the startup community. â Simon
 --------------------------------------------------------------- NEWS YOU SHOULD KNOW Also check out Tech in Asiaâs coverage of the fintech scene [here](. 1ï¸â£Â [UK fintech VC Illuminate officially expands into Asia]( The firm plans to build an investment team in Singapore over the next 18 to 24 months. 2ï¸â£Â [CEO of Vietnam-based digibank Tnex to step down]( Tnex said itâs now serving over 1.6 million customers, targeting primarily Gen Z and millennial customers. 3ï¸â£Â [MoMo, Western Union partner to boost VN remittances]( Users will be able to route their Western Union transfers to the MoMo app without incurring additional fees. 4ï¸â£Â [PhonePe secures $200m from Walmart to develop new businesses]( The India-based fintech major has raised a total of US$650 million this year.
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