Professional Documents
Culture Documents
Sean Creehan
Senior Supervisory Analyst
Country Analysis Unit
Division of Financial Institution Supervision and Credit
The opinions expressed in this presentation are statements of the speaker's opinion, are intended
only for informational purposes, and are not formal opinions of, nor binding on, the Federal Reserve
Bank of San Francisco or the Board of Governors of the Federal Reserve System
Agenda
• SF Fed Asia Program’s Interest in Fintech
• Importance of Small- and Medium-sized
Enterprises (SMEs) in Asia’s Economy
• SME Credit Gap in Asia
• Why Digital Innovation is Well Placed to Help
• Policy as Catalyst, Guardrail
Agenda
• SF Fed Asia Program’s Interest in Fintech
• Importance of Small- and Medium-sized
Enterprises (SMEs) in Asia’s Economy
• SME Credit Gap in Asia
• Why Digital Innovation is Well Placed to Help
• Policy as Catalyst, Guardrail
San Francisco Fed Asia Program
• Our mission
• Our team
• Research into banking and
financial developments in
Asia
– Growing focus on digital
innovation and fintech
• Outreach
– Symposium on Asian Banking
and Finance
– Asian Regulator Training
Program
• www.frbsf.org/banking/asia-
program
Agenda
• SF Fed Asia Program’s Interest in Fintech
• Importance of Small- and Medium-sized
Enterprises (SMEs) in Asia’s Economy
• SME Credit Gap in Asia
• Why Digital Innovation is Well Placed to Help
• Policy as Catalyst, Guardrail
Small Businesses Play a Large
Role in Asian Economies
Country SME Share of SME Data Year
Employment Contribution
(%) to GDP(%)
China 65 60 2011, 2013
Hong Kong 47 -- 2012
India 40 38 2015, 2013
Indonesia 97 60 2009, 2013
Japan 70 44 2012
Korea 88 48 2012
Malaysia 65 36 2014
Philippines 64 36 2013, 2009
Singapore 68 45 2012
Taiwan 78 30 2011
Thailand 80 40 2014
Vietnam 47 40 2012, 2011
Source: ADB, APEC, IMF
Agenda
• SF Fed Asia Program’s Interest in Fintech
• Importance of Small- and Medium-sized
Enterprises (SMEs) in Asia’s Economy
• SME Credit Gap in Asia
• Why Digital Innovation is Well Placed to Help
• Policy as Catalyst, Guardrail
Asia’s SME Credit Gap
• One million jobs needed every month to absorb Asia’s
growing workforce
• Under 20% of bank credit for a sector representing more
than 40% of the economy
• Asian SMEs lag behind global peers in access
• Two big challenges:
– Lowering costs to finance SMEs
– Estimating more accurate risk given limited information
Agenda
• SF Fed Asia Program’s Interest in Fintech
• Importance of Small- and Medium-sized
Enterprises (SMEs) in Asia’s Economy
• SME Credit Gap in Asia
• Why Digital Innovation is Well Placed to Help
• Policy as Catalyst, Guardrail
Why Digital Innovation is
Well Placed to Help
The rapid digitization of Asian economic and social life
can:
• Provide new data to reduce the SME information gap
• Increase efficiency of businesses
like trade finance
• Broaden the reach of invoice
financing across the global
supply chain
• Create leapfrog opportunities
Alternative Credit Scoring for
SMEs with “Thin Files”
• China’s Baihang Credit Scoring: consumer focused,
but could extend to SMEs
• Japan’s Credit Risk Database
• Enhancing Credit Guarantee programs
More Efficient Trade Finance
• Asia now responsible for 1/3 of global trade; large role of SMEs in
exports, particularly down the supply chain
• ADB: $150 billion annual trade finance gap just for SMEs ($600
billion overall)
Sean.Creehan@sf.frb.org
Visit www.frbsf.org/banking/asia-program
for research, blogs, podcasts, and more