Affinidi Finnovate Launches, Aiming to Support 290 Million Consumers and 55 Million SMEs underbanked across ASEAN

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DigitalCFO Newsroom | 10 November 2021

New Affinidi Business Unit Brings Ground-Breaking Web 3.0 Technology to Financial Services Industry

Affinidi, a Singapore-based technology company founded by Temasek, today launched a new business unit called Finnovate that aims to help both underbanked individuals and under-served small-medium enterprises (SMEs) by enabling partners to adopt Web 3.0 technology.

There are over 1.7 billion people underbanked worldwide, of which, 290 million are in ASEAN alone. In addition, there are more than 55 million SMEs in ASEAN that currently do not have access to the loans they need.

Deploying Web 3.0 innovations such as decentralised protocols and Verifiable Credentials (VCs), Affinidi Finnovate aspires to enable a more innovative and inclusive financial ecosystem that better meets the needs of these groups. To that end, the business unit is partnering with stakeholders across the financial services sector, including banks, insurers, asset managers, fintechs, regulators and many others, to achieve this goal.

“People and businesses all over the world are unable to access banking products that many of us take for granted simply because they have difficulty presenting the right documentation,” said Varsha Jagdale, General Manager of Affinidi Finnovate. “Using Verifiable Credentials, we are creating a win-win for financial institutions and their customers; financial institutions have a deeper understanding of their customers  while their customers can access a wider variety of products.”

Inability to access financial services disproportionately affects both young people and SMEs. Despite accounting for 140 million jobs and representing 99% of all businesses in the region, under-served SMEs have been a chronic issue in South-East Asia.

“One of the consequences of underbanking is that less than 20% of the population in ASEAN has access to credit. As we emerge from the pandemic, this is a potential handbrake on economic growth across the region,” Varsha Jagdale elaborated.

A key barrier to access banking is documentation. According to a World Bank survey 20% of adults without an account at a financial institution reported lacking the documentation needed to open one. However, this figure is more than double in some countries, including the Philippines at 45%.

Affinidi Finnovate aims to allay the issue of documentation through the use of VCs, which are digital certificates that can be used to represent any type of information – from financial and health records to education qualifications for individuals, or business licences and certifications for SMEs. Unlike physical credentials, a VC is digitally signed by the issuer of the credential and is machine readable, so that anyone it is shared with can easily verify its authenticity and validity without reverting to the issuer. Asymmetric cryptography is used to sign and verify VCs, so they are tamper-evident and cannot be easily forged.

Utilising Affinidi’s technology, financial institutions can identify, onboard and serve their customers faster and in a more personalised manner, whether it is as simple as helping more people set up bank accounts and secure loans or accessing other, much-needed, but previously unattainable financial products such as individual or business loans, personal or commercial insurance and other bespoke financial services.

“Verifiable Credentials will give financial institutions the data they need to open up the world of financial services to those that need it most,” said Glenn Gore, CEO of Affinidi. “Our open, secure and interoperable platform will make it easy for any financial institution – and its regulators – to redefine the way they serve organizations and individuals.”

Introducing ChekFIN

Affinidi Finnovate is already paving the way for financial institutions to accelerate their move into a digitally-led banking ecosystem through ChekFin – an initiative launched on 9th November 2021 at the Singapore Fintech Festival.

Chekfin makes it easier for financial institutions to identify, engage and collaborate with FinTech businesses, boosting the possibility of more innovative, inclusive products and services.

Until now, there has not been an effective, trusted way for financial institutions to find, collaborate and develop innovative solutions with FinTechs due to  concerns over enterprise grade capacity, scalability, reliability, and compliance readiness.

ChekFIN will be launched as part of the APIX platform, which is owned and operated by the ASEAN Financial Innovation Ltd (AFIN). APIX is an initiative of the ASEAN Financial Innovation Network (AFIN), a not-for-profit entity that was jointly formed by the Monetary Authority of Singapore (MAS), the World Bank Group’s International Finance Corporation (IFC) and the ASEAN Bankers Association.  ChekFin will facilitate identification, verification and monitoring of FinTechs all across the world with the goal of speeding up engagement and helping to accelerate innovation in the financial services sector globally.

“Verifiable Credentials will allow financial institutions globally to find and build relationships with FinTechs at the pace needed for today’s speed-of-light economies,” said Sopnendu Mohanty, Chief FinTech Officer at the Monetary Authority of Singapore. “The partnership with BCG FinTech Control Tower and Affinidi Finnovate will simplify collaboration and put Singapore at the epicentre of innovation in the global financial services sector.”