PINTEC's Wealth-management Venture PIVOT Sees Boost from China's Belt and Road Initiatives

Author: PRNewswire | 2017-10-07

  • Partnering with FWD Group, PIVOT is banking on Southeast Asia's fintech potential, bolstered by the Chinese government's Belt and Road program

SINGAPORE, Oct. 17, 2017 /PRNewswire/ -- Riding the wave of China's expanding "One Belt, One Road" economic initiative, Beijing-based financial technology company PINTEC Group has expanded its presence into Southeast Asia by setting up its first venture in Singapore, pinning hope on the region's rising demand for digital wealth-management services to boost its global push.

PINTEC's first venture outside of China, PIVOT Fintech Pte., is in part backed by FWD Group, the insurance unit of Pacific Century Group. Established in 2013 in Asia, FWD Group has grown rapidly as an innovative and dynamic player across the region.

"We are pleased to collaborate with an innovative and entrepreneurial financial group like FWD," said William Wei, CEO of PINTEC Group. He added that Singapore is an ideal launch-pad to do business in Southeast Asian countries.

The new venture targets the Southeast Asian market, which offers huge business potential due to its steadily growing middle class, making it a key destination for Chinese companies that are going global as part of China's Belt and Road initiative. The Belt and Road program offers a wide-range of business opportunities across industries from telecommunications, infrastructure to finance and technology.

"We are a leading fintech company from China, so we are taking the initiative to expand our footprint in Belt and Road countries," Wei said. "There is an increasing number of Chinese fintech companies who are making their mark in Southeast Asian countries in response to the government's Belt and Road initiatives."

The Silk Road Economic Belt and the 21st Century Maritime Silk Road initiatives, known as "One Belt, One Road", were first announced by President Xi Jinping in 2013. The China-initiated strategic plan involves more than 60 countries, encompassing more than 50 percent of the world's population, and one third of the global economy.

The major part of the initiative is the creation of an economic land belt that includes countries on the original Silk Road through Central Asia, West Asia, the Middle East and Europe, while the maritime road links China's port facilities with the African coast through the Suez Canal into the Mediterranean.

PINTEC is among the first leading fintech companies to tap the market along the Belt and Road economic zones, as other Chinese technology giants also are stepping up their efforts to expand e-commerce and financial services businesses to these countries.

"Through PIVOT, we hope to tap the huge fintech potential in Southeast Asia," Wei said.

Meanwhile, PIVOT has been working to provide digital solutions to a wide-range of financial intuitions including banks, securities companies and wealth managers in Asia.

PIVOT is in talks to further cooperation with financial institutions in the region, while Singapore and Malaysia are the first markets the new venture is tapping into.

Founded in 2012, PINTEC is one of China's fastest-growing fintech companies, providing a wide-range of financial services powered by its artificial intelligence technologies.

PINTEC has expanded its businesses to cover robo-advisory services, digital lending, online mutual funds and online insurance brokerage services.

PIVOT is leveraging PINTEC's strengths in big data, algorithms and deep-learning to offer dynamic financial services to institutions in Southeast Asia.

"PINTEC's well-established team, which includes top engineers, data analysts and staff members, will be devoted to support PIVOT in tapping the potential in the Southeast Asian market," said Zheng Yudong, CEO of POLARIS, the robo-advisory unit of PINTEC.

POLARIS, which launched in June 2016 as PINTEC's flagship digital wealth management platform, is a pioneer in the Chinese market. Breaking the boundary in traditional financial services, POLARIS has partnered with Minsheng Securities and Anbang Insurance Group to bring digital financial services to a wider range of users.

An increasing number of Chinese customers are turning to digital wealth-management services. In particular, customers are increasingly interested in seeking professional advices in asset allocation from robo-advisors. POLARIS provides customers with machine-generated asset portfolios which are adjustable in real time and customized to meet individual customer's risk appetite.

PIVOT is now bringing POLARIS' services and products to partners in Singapore and other Southeast Asian countries. "Dynamic asset allocation" is one of the unique services provided by PIVOT.

Besides a customized investment portfolio based on a customer's risk appetite, real-time adjustments are to be made according to changes in the investment markets supported by machine-learning algorithms.

"PIVOT is an exciting opportunity for customers in the region," said the company's co-founder and CEO Victor Lye, who has 25 years' experience in investment, insurance and healthcare industries.

In Southeast Asia, wealth-management services are on the rise, bolstered by the demand from the middle class in the region. According to the World Bank's forecast, the middle class of South and East Asia will account for 8.9 percent of the global population and 7.7 percent of global income by 2030.

This same group accounted for 1.4 percent of the world's population and 2.1 percent of global income in 2000. This growth in population and income make Southeast Asia an important consumer market and also an engine to drive economic growth in the region.

With rising wealth, the growth in the region's internet population is also strong. The number of internet users in Southeast Asia increased by 31 percent to 80 million at the end of January, from the same period of last year. Active social media users also grew by 31 percent to 72 million at the end of January from the previous year.

"The penetration level of inclusive financial services is relatively low in populous Southeast Asian countries," PINTEC's Wei said. In order to spread the use of financial services, fintech is a significant element, he added.

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