In The Top Up this week, we look at key fintech funding trends in Southeast Asia and dive into QRISâ upcoming features in Indonesia. [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](. IN FOCUS In today's newsletter, we look at: - [SEA insurtech pulling money in when funding for the overall fintech sector dropped](
- The latest QRIS features for sending, withdrawing, and depositing money
- [Lenders using social media data to assess usersâ creditworthiness]( --------------------------------------------------------------- Hello {NAME} Despite the choppy fintech funding seas, insurtech players in Southeast Asia have found a way to weather the storm and secure capital. Among fintech players, insurtech firms raised the most funding in the first half of 2023, my colleague Simon highlights in this weekâs Big Story. Singaporeâs Bolttech netted US$196 million in a series B funding round in May. Bolttech's fundraise was also part of a [rebound of Japanese investments]( in the regionâs fintech sector, a trend I highlighted last month. Meanwhile, in this week's Hot Take, I look at new features related to fund transfers, withdrawals, and deposits that will be introduced as part of the Quick Response Code Indonesian Standard this August. Do these additions represent a positive development in improving financial inclusion or do they risk deterring traditional banks from setting up in remote areas? Read on to find out more. -- Budi
 --------------------------------------------------------------- THE BIG STORY [SEA fintech sector hits funding slump in H1 23, but insurtech holds up]( Contrary to expectations, the share of pre-series A investments fell, while bridge financing expanded.
 --------------------------------------------------------------- THE HOT TAKE Impact of QRIS services on the unbanked: widening or narrowing the gap? Hereâs what happened: - Starting from August, Indonesians will be able to transfer, withdraw, and deposit money using the Quick Response Code Indonesian Standard (QRIS), Bank Indonesia recently [announced](.
- Currently, QRIS can only be used for domestic and cross-border payments.
- Withdrawals and deposits can be done by scanning a QR code at an ATM or by transacting with QRIS partner merchants. Hereâs our take: There is no denying that QRISâ upcoming features hold the potential to improve interoperability between banks and non-banking financial institutions, with the ultimate aim of promoting financial inclusion among Indonesiaâs unbanked and underserved population, which make up [51% and 26% of the countryâs adults]( respectively. Currently, QRISâ only functionality is allowing users to transact both domestically and in [overseas countries like Thailand and Malaysia]( through Indonesian banking and fintech apps. For the unbanked population, QRISâ new features address their fundamental banking needs. Even without a bank account, a user will be able to withdraw cash from an electronic money account tied to a payment service provider. Transfers, withdrawals, and deposits can be done via ATMs. These services can also be accessed through QRISâ agent network, which will benefit those who live too far from an ATM. âYou can also help your families in villages who donât have a bank account by sending money via QRIS,â Bank Indonesia said in a [press release](. However, the convenience and pervasiveness of QRIS in the future could reduce the motivation for individuals to open traditional banking accounts. Thatâs because services like withdrawals and deposits - previously only possible for those with bank accounts (with the exception of a few e-wallets like Dana) - will become available through non-bank channels or offline merchants. Consequently, QRISâ expansion may deter traditional banks from beefing up their presence in remote areas, where players have historically struggled to penetrate due to geographical constraints. As such, unbanked individuals in far-flung areas may continue to lack access to essential financial services such as loans and insurance. They may also find it hard to obtain credit, hindering their ability to invest in education or housing. While QRISâ new services represent a positive step forward by expanding the scope of services provided by payment service providers, their impact on financial inclusion could be limited. See also: [QRIS, BI Fast propel banksâ fight against e-wallets in Indonesia]( Thereâs also the question of how far the network can penetrate the countryâs remote areas. As of May 2023, the number of QRIS merchants reached [26.1 million]( but itâs expected that the new services will not immediately involve all these merchants. This is because the QRIS ecosystem encompasses various types of businesses, including parking lots and donation spots, which may not have the infrastructure to handle cash withdrawals and deposits. Leveraging the networks of convenience store chains like [Alfamart and Indomaret]( - both existing QRIS merchants - will be crucial for Bank Indonesia to maximize the potential of the new services. Combined, both retailers operate approximately 40,000 stores across the archipelago. They allow customers to not only pay for their shopping items using banking and fintech apps like Ovo but also withdraw cash via debit cards and make top-ups for digital wallets such as Dana. They also already facilitate remittance services, which only require a simple code for the other end to receive the funds. Collaborations with such players will be crucial for facilitating wider adoption and access to these services for the unbanked population. -- Budi
 --------------------------------------------------------------- NEWS YOU SHOULD KNOW Also check out Tech in Asiaâs coverage of the fintech scene [here](. 1ï¸â£Â [Coda Paymentsâ FY 2022 profit shrinks 63%, revenue stalls]( CFO Abhi Sharma attributed the results to pandemic-induced travel demand and renewed interest in out-of-home entertainment hampering the gaming industry's growth. 2ï¸â£Â [VNG targets $393.3m in net revenue for 2023]( The Vietnamese company also expects a 63% year-on-year decline in its net loss for the year. 3ï¸â£Â [SeaMoney sheds jobs in Indonesia]( The move was a part of a âregular review of business operationsâ to optimize efficiency, a company spokesperson said. 4ï¸â£Â [BNPL major Atome confirms exiting Vietnam]( According to the firm, the contribution of its Vietnamese unit to the overall business was âlimited.â 5ï¸â£Â [Indonesia-based Futuready officially shuts down]( Launched in 2016, it said that it was the countryâs first licensed online insurance broker.
 --------------------------------------------------------------- FYI [For the loan: Lenders like KakaoBank turn to social media data for credit scoring]( The South Korean bank is using data from online platforms, lifestyle apps, and other alternative sources to assess creditworthiness. But other banks remain wary.
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