When Tan Su Shan, DBS's group head of consumer banking and wealth management, wanted to learn more about a certain financial wealth app, she flew to Silicon Valley and tried to arrange a meeting with the company that developed it. Despite her valiant efforts, she got the cold shoulder.
"I know why they don't want to see me, because they don't want me to ask questions and learn," Tan told reporters at a briefing held at the bank's Singapore headquarters on Thursday last week. "Then I worry more. But also there are fintech companies that come and see us everyday."
Fintech companies aren't a cause for concern just for Tan but for banks globally. Today, banks in Asia aren't just facing competition from other banks but also from the likes of China's internet giants Alibaba, Baidu and Tencent, which have scaled up their e-commerce and finance platforms.
To compete, Singapore's largest lender DBS is trying to imbue some startup culture into its own. That is no mean feat for the bank, which is controlled by Singapore's state investment fund Temasek Holdings.
In April, the company ran a three-day hackathon (an event where geeks collaborate with project managers to create software), during which some 150 bank staff teamed up with startups to create mobile apps. That inevitably led to an initial culture clash of suits and hoodies.
"We brought in our top senior leadership mixed with a bunch of [20-somethings] in t-shirts and jeans and we said go build applications," David Gledhill, head of group technology and operations, told reporters on Thursday.
So as internet players threaten to disrupt the traditional banking model by pushing into finance, banks such as DBS are looking to build up their defences by moving in the opposite direction and adopting the mindset of a technology startup.
DBS said last year that it is investing S$200 million to build out its digital platform. In line with that, the bank partnered up with IBM to introduce Watson, a super computer that trumped contestants in the long-running US TV game show "Jeopardy!". The bank's executives say Watson has helped to give its relationship managers tools to better identify clients' investment needs.
The bank also has a team that meets with young fintech companies to ferment ideas and experiment.
In Asia, companies such as Alibaba's e-commerce arm Alipay, Samsung Pay, and Tencent-backed WeBank threaten to eat banks' lunch. With the launch of money market funds, these tech companies are also increasingly encroaching onto the asset management space.
Alibaba in 2013 launched money market fund Yu’e Bao, which literally means “leftover treasure", and its assets under management grew by 23% in the first quarter of this year to reach Rmb711.7 billion ($114 billion) at the end of March.
In May, China’s biggest smartphone maker Xiaomi also launched its first money market fund.
In addition, internet companies have been bulking up and making acquisitions at ferocious speed to support their ecosystems. "The double disruption is even more scary because these companies are now building vaster ecosystems," Piyush Gupta, DBS's chief executive officer, told participants at the bank's Asian Insights conference on Friday.
To illustrate how internet companies are further entrenching their presence in consumers' lives, Gupta cited the example of Jack Ma's Alibaba, which recently invested in ride-sharing app Lyft. He also cited Amazon, which this year bought Shoefitr, a digital imaging app that allows potential buyers of shoes to try them on.
For their part, internet finance companies say they aren't out to get the banks but instead aim to service those clients who might otherwise fall through the cracks. "Our [service]...is not for the rich people, it's for the 80%...that don't have access to financial [services]," Sabrina Peng, president of Alipay International, told participants at the DBS conference.
Soul Htite, the CEO of Chinese peer-to-peer lender Dianrong.com, prefers to think of the company he founded as a transformative force to banks, rather than a disruptive one. "We work super closely with banks so that we can intercept a customer right after he does not qualify for the traditional banking product," he told the conference.