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1. Overview of Fintech & RHB’s POV 5th September 2016
Rohan Krishnalingam
Group COO, RHB Banking Group
RHB BANKING GROUP

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FinTech companies are providing services in multiple areas that are
typically provided by financial institutions and this causes disruption to
banking business…
Lending Payments
Retail Investments Personal Finance
Equity Financing
Consumer Banking
Remittance Financial Research
In Asia

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Emerging and rapid advances in technology enables Fintech to go to market
quickly causing rapid disruption to banks..
Cloud Mobile Development Cloud Infra Providers Cloud Banking Providers Cloud Payment Providers
Machine Learning
Blockchain
Big Data & Analytics
Natural Language Processing
Distributed ledger removes
the need for centralized
processing body such as
banks for payment clearing.
Intelligent algorithms
replace the need for
human financial
advisors for
investments.
Predictive risk scoring through social
media information mining allows near
real-time financing online.
NLP allows machines
to understand human
speech and respond
accordingly; removing
the need for banking
staff to respond to
sales & service
inquiries
Biometrics
Fingerprint, voice & facial biometric is simplifying
digital experience for authenticating & authorizing
transactions such as payments.

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 Established BBVA Ventures for early stage and
later stage venture investments, with USD
100m raised so far.
 Has acquired Simple, and invested in Coinbase,
Taulia, Radius, Ribbit Capital, 500 Start-up,
Prosper Marketplace, DocuSign, Personal
Capital, SumUp, Kasisto
 Established a Direct Private Investment arm
that does Seed, Early Stage, Venture, Later
Stage, PE and Debt Financing Investments.
 Has over USD 125 billion of capital to invest
and has 313 investments in 215 companies
with 33 IPOs and 67 acquisitions
Financial institutions are taking a wide range of approaches to keep up with
technology innovations that is threatening to disrupt the sector
 Launched Innoventures; a USD100
million FinTech venturecapital fund
based in London
 Created of a USD200 million fund
targeted at the FinTech sector, focusing
on both retail and wholesale banking
markets with the aim of improving its
technology systems
 Sberbank’s SBT Venture Capital; a USD100
million fund for the FinTech sector,
providing finance and support in return for
insight and potential collaboration
 The Plug and Play FinTech Programme; a
partnership between Citi’s global corporate
venturing arm, Citi Ventures, and Californian
accelerator Plug and Play, with locations in
the US, Germany, Singapore, Brazil and
Spain
 The Barclays Accelerator Programme; a
London-based incubator scheme providing
FinTech start-ups with funding, office
space and access to Barclays’ APIs and
data
 Launched a FinTech Accelerator program
that combined a cash investment with a
minority stake for 6 months of coaching &
collaboration
 Selected 3 companies in areas of artificial
intelligent, location and mobile identity
technologies
 Launched Blockchain Innovation Lab; in
London’s Level39 accelerator space with
the aim of collaborating with the wider
FinTech Community
 Set up MyIdea to provide a platform where
employees can pitch ideas and enter
competitions to improve business areas
 Launched 36-hour hackathon under its
LeumiTech and Salesforce in Tel Aviv, with
the aim of developing applications within the
FinTech space

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Regulators in Malaysia and the region has been increasing their focus & support for
Fintech market to flourish.
• BNM intends to come out with a
framework to encourage
Fintech innovation.
• Currently reviewing changes
and additional guidance needed
to ensure regulatory framework
remains appropriate to manage
the risks, while encouraging
productive innovation that will
drive costs down and improve
the quality of service to
consumers.
• Plans to set up a “regulatory
sandbox” to enable financial
institutions (FIs) as well as non-
financial players to experiment
with financial technology
(FinTech) solutions.
• Intends to create a "Sandbox"
environment for Fintechs to test
innovative products, services, &
business models whilst ensuring
consumers are protected
• Will ask Fintechs to register and
have the powers to regulate
them once they get to a certain
size
• P2P Lending seems to be the
largest focus area for Fintechs in
Thailand now, guidelines have
been issued
• The other area of focus for
Fintechs in Thailand is in
Payments and likely to be under
oversight of BOT
• Setting up a FinTech Office to
serve as a one-stop virtual
entity for all FinTech matters
and to promote Singapore as a
FinTech hub
• The FinTech office will provide
advice on various FinTech grants
& schemes, as well as identify
gaps and propose strategies,
policies to encourage FinTech
• Partnering with Australian
regulator to help fintechs with
cross-border expansion
• Plans to set up a “regulatory
sandbox” to enable financial
institutions (FIs) as well as non-
financial players to experiment
with financial technology
(FinTech) solutions.

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Throughout the last 2 years, RHB has been actively involved in Fintech
collaboration through our partner Startupbootcamp including organizing
hackathons to boost new startups

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RHB’s strategy includes partnering with innovative start-ups to provide new
digital services to our customers…
Regional
accelerator
Collaboration /
Partnership
Co-Investment
Local
incubator
• Business
Mentoring
• Start-up
Funding /
EquityStake
• RHB customer
alternative
investment
model /option
• Businessand
technology
exchange
• InnovationAdvisory
Panel with key
technology&
financialpartners to
advise & nurture
start-ups
Potential IAP members
Online restaurant reservation app
SME retail point of sale solution
Online marketplace for services
Currency exchange
rate comparison app

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RHB’s strategy for Fintech is to closely monitor potentially disruptive fintechs and
where relevant, to collaborate or invest accordingly…
FinTech
Companies
Providing for
unbanked
customers
Efficiency /
Customer
Experience
improvements
Disruptive to
banks
• Low priority, monitor only
• High Priority - monitor,
understand / adapt if relevant for
bank or for customers
• Collaborate where relevant
• High Priority - closely monitor and
understand impact to us and how to respond
• Determine if equity / investment is required
as defensive strategy

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Thus far, RHB has been closely engaging numerous startups across various
Fintech areas of innovation…
45 13 4 3
FinTech’s /
Startups
Assessed
Currently in
discussions
with…
Providing
payment
services to…
Formally
collaborating
with…
• SBC Fintech Lounge (6)
• SBC 2015 Cohort (10)
• SBC 2016 Cohort (10)
• Others (19)

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RHB is constantly looking for innovation from Fintech and one of the key
problem that we would like to challenge Fintech to solve is..
Via SBC (Startupbootcamp)
Success of Fintech startup products & solution is highly dependent on creating
excellent customer experience & seamless integration with banking services
such as payment. Creating simplified B2B/B2C payment experience is one of
the critical areas of focus for many Fintech app developers
What is an innovative payment API solution that could enable Fintech app
developers to quickly integrate with RHB’s payment services to offer
seamless & best in class B2B/B2C payment experience for users?
Problem Statement

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RHB is constantly looking for innovation from Fintech and one of the key
problem that we would like to challenge Fintech to solve is..
Via SBC (Startupbootcamp)
Banks are increasingly facing pressure to improve quality of service while
controlling cost of operations. One of the innovation that could contribute in
this area is the use of machine learning to improve service & reduce human
dependency.
How can machine learning help in empowering investment advisors and
complementing their knowledge with machine generated insights in order
to provide high quality investment advise to customers?
Problem Statement

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RHB is constantly looking for innovation from Fintech and one of the key
problem that we would like to challenge Fintech to solve is..
Via SBC (Startupbootcamp)
Banks are increasingly facing competitive market and in pressure to innovate
ways to acquire new customers. One of the challenge faced is the regulatory
requirements around KYC & customer verification which is still reliant on
physical methods thus limiting bank’s ability to fully on-board customers
through digital channels.
What are the innovation that can improve customer acquisition methods
and enable a fully digital on boarding of new customers while not violating
regulatory requirements?
Problem Statement

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RHB is constantly looking for innovation from Fintech and one of the key
problem that we would like to challenge Fintech to solve is..
Via SBC (Startupbootcamp)
Banks are increasingly facing pressure to improve quality of service while
controlling cost of operations. One of the innovation that optimize banks
operating cost is blockchain.
Which area of banking operations can be optimized via blockchain and what
is the innovative blockchain solution that will increase efficiency and reduce
cost of operations in the area?
Problem Statement