TOKYO -- Sumitomo Mitsui Banking Corp. is going full tilt into mobile phone-based payment services in Asia as part of a push into financial technology -- or fintech.
The Japanese megabank has co-developed a smartphone payment app with Indonesia's Bank Tabungan Pensiunan Nasional, in which it has a 40% stake. The Jenius app, released in August, allows users to make payments by inputting recipient information such as their bank account number. Even if the sender does not know the recipient's account number, money can be sent, leaving the recipient to fill in the information on the website.
Jenius also allows a user to request payments from multiple people at once. Money is sent when the payer approves. This function could be used for a group of friends splitting restaurant bills. In addition, users can cancel or reactivate debit cards that are linked with the service from inside the app.
The Indonesian bank introduced its first mobile payment service in March 2015. But with upper limits set for transaction values, the service is mainly targeted at low-income consumers. SMBC, a unit of Sumitomo Mitsui Financial Group, hopes the new app, with additional features and no limits, will appeal to middle and high-income consumers. Jenius will also be targeted at Japanese and other expatriates in Indonesia. The bank expects the number of users to reach 100,000 this year and 1.5 million in 2020.
With plans to roll out Jenius in other Asian countries, staffers involved in the app's development have started market research. SMBC has local bank connections via partnerships and investments in Vietnam, Cambodia and Myanmar, and hopes to "export" this new service to these markets.
Untapped banking demand
In Japan, almost 100% of the population has bank accounts, but only 36% of Indonesians do and 31% of Vietnamese. Many people in these countries do not use banking services, but do have mobile phones. So an increasing number of banks are offering mobile payment services, hoping to expand their customer bases.
Malaysian financial giant CIMB Group Holdings offers a mobile payment option for shopping at convenience stores, via a partnership between a subsidiary and an Indonesian convenience store operator. Citibank of the U.S. offers smartphone apps that handle payments and money transfers in multiple Asian countries.
In some cases, Japanese banks have started offering the latest financial services in other Asian markets before they launch them in Japan. For instance, Bank of Tokyo-Mitsubishi UFJ, a unit of Mitsubishi UFJ Financial Group, announced a joint experiment with Hitachi in Singapore for the use of virtual-currency technology in clearing checks.