THE FUTURE OF DIGITAL FINANCE IN SOUTHEAST ASIA: A Legal Perspective

DAFTAR ISI

Foreword            v

Table of Contents vii

INTRODUCTION                1

HISTORY OF DIGITAL FINAN CE 3

The Digital Footprints of the Past for the Modern Financial Era. 6

The Present Situation…. 7

The Long Run…. 8

DIGITAL FINAN CIAL INCLUSION                ……..9

Digital Financial Literacy….11

Digital Financial Services…11

Digital Financial Services (DFS) Benefits….12

The Importance of Digital Finance Transformation……12

Digital Finance in the Future…..13

DIGITAL FINAN CE ECOSYSTEM 15

What is the Ecosystem of the Digital Finance System?……16

Digital Financial Services’ Purpose16

The Components of the Digital Financial Ecosystem…18

Digital Financial Services…21

The DFS Ecosystem’s Evolution…..22

Ecosystem Problems and Challenges..25

DIGITAL FINANCE IN ASIA            29

Digital Finance Has Yet to Offer Value to Poor Households and Small Companies31

Asia’s Digital Finance Potential Is Not Fully Realized….32

Rising Cellphone Adoption Rates Can Help Digital Finance……33

FINAN CIAL INCLUSION IN SOUTHEAST ASIA       35

The Present State of Things and The Financial Opportunity…..37

Southeast Asia’s Big Opportunity…39

Digital Payments and Remittances Have Reached a Tipping Point42

A Highly Fragmented and Diverse Landscape..44

The Customer-Gatekeeper Relationship Is the Ultimate Battleground

for Everyone…..44

On The Banked, Established Players Maintain a Stronghold…..45

The True Growth Engine is the Underbanked…45

There Is No Cure-All for the Unbanked.45

The SME Merchant Opportunity is Ripe for the Picking46

Banks Will Remain Relevant If Their Balance Sheets are Strong…..46

Regulations That Support Maximum Potential are Essential….46

Convenience, Access, and Value for Consumers….47

CHALLENGES FACING DIGITAL FINAN CE IN ASIA               51

Fintech Redefines a Specific Sector Which Exists at the Intersection

of Financial Services and Technology..56

Asian Economies Have Risen to Prominence as Worldwide Leaders

in Financial Innovation.56

The Application of Mobile Internet Access to Payment Services is the

Most Innovation-Active Area in Asia…..57

Implications and Difficulties…..58

Four Critical Policy Issues..59

Southeast Asian SMES are Being Left Behind by the Digital Revolution……62

SMEs in Southeast Asia are Underperforming.63

SMEs and Fintech..63

LEGAL CHALLENGES FACING DIGITAL FINANCE IN SOUTHEAST ASIA         65

± LAOS 66

Laos’s Digital Framework…66

Regulatory Enhancements are Still Required….67

Prospects for the Future….68

The UNCDF Effort..68

Ecosystem of Digital Financial Services…..69

PHB-facilitated Workshops During the Period..70

Facts about Financial Literacy in Lao PDR.71

TABLE OF CONTENTS ix

Fintech Development in the Lao People’s Democratic Republic……71

Lao People’s Democratic Republic’s Internet Infrastructure……72

Legal Landscape for Fintech….72

±± BRUNEI 74

±± Timor-Leste 77

±± MYANMAR 80

±± CAMBODIA 82

Legal Environment and Sustainability..84

±± INDONESIA 86

COVID-19 Outbreak Has Played a Vital Role in Indonesia’s Economy…87

Legal Challenges…88

Mobile Device Threat…91

±± MALAYSIA 94

Fraud, Online Gambling, Money Laundering and Illegal Crypto Trading96

±± SINGAPORE 101

Data Security.103

Inadequate Mobile and Technological Knowledge……104

Technological Problems…104

Difficulty in Integration of Bio Data and Artificial Intelligence..105

Blockchain Integration Problems.105

User Retention and Experience…..106

Individualized Services…..106

Sophisticated Cyber Threats..107

Adherence to Government Rules..107

±± THAILAND 109

Legal Challenges Facing Digital Finance..110

±± PHILIPPINES 117

The Philippine Central Bank Has Issued Guidelines for the Establishment of Digital Banks…..118

Major Digital Challenges in Philippine Financial Industry..120

Digital Transactions Expected to Grow in Philippines Despite Challenges…..122

±± VIETNAM 125

COVID-19 Outbreak….126

Blockchain……127

Internet Banking…127

Challenges in Technology128

Security Concerns……128

Complex Transactions are Inefficient.128

Lack of Interpersonal relationship129

Deposits are Inconvenient……129

Online Gaming……129

Insecurity of Personal Data….130

REGULA TORY FRAMEWORK OF LEGAL CHALLENGES ON DIGITAL FINAN CE WITHIN SOUTHEAST ASIA     133

±± REGULATORY FRAMEWORK OF LEGAL CHALLENGES ON DIGITAL FINANCE WITHIN SOUTHEAST ASIA 134

A Short History…………135

Current Situation..136

Overview of These Countries.136

±± Prospect for the Future           159

Closing the Gap….159

REFERENCES 161

AUTHOR PROFILE 167