Of money and cars: EmTech Asia Day Two

• Can’t get the genie back into the bottle
• Human behaviour informs tech use, regardless of industry

 
WHEN you think about the financial and automobile industries, one of the first things that come to mind is the immense disruption they are facing from technologies such as blockchain and autonomous cars, respectively.
 
The financial industry is not known for its nimbleness and ability to adapt to disruption, partly because it is a heavily-regulated industry.
 
But even regulators are waking up to the fact that they are facing a new world of disruptive technologies and business models, especially from financial technology (fintech) startups.
 
Some regulators are, in fact, looking to emerging technology to improve current financial practices, according to the Monetary Authority of Singapore’s (MAS) chief fintech officer Sopnendu Mohanty.
 
“There’s a myth going around that we don’t support cloud computing,” Sopnendu said in his presentation on the second day of the EmTech Asia 2016 conference in Singapore.
 
“Let me be very clear upon that – we do support cloud computing,” he added.
 
In fact, in an effort to support new technologies, MAS announced a new fintech sandbox is in the works for financial institutions and startups to try out new technology.
 
“We will be the first regulator to announce it … it will be for banks and other financial institutions to come to us and experiment.
 
“This allows new technology to be in production and [ready to face] face actual customers,” he added.
 
Sopnendu also announced that MAS is organising a conference with both financial institutions and fintech companies on APIs (application programming interfaces).
 
“By the end of March, we are conducting a global API conference in Singapore to bring all the banks and fintech companies together to decide on certain standards on how to operate in this space,” he said.
 
EmTech is the series of annual global emerging technologies conferences hosted by MIT Technology Review. Digital News Asia (DNA) is a strategic partner of EmTech Asia in Singapore.
 
Banks need to buck up
 

 
While Singapore’s financial regulator seems on the ball, Asia’s banks did not fare so well, getting a drubbing from Tony Chew, Citibank’s Asia Pacific regional head of Information Security, and global head of Cyber Security Regulatory Strategy.
 
“Why are our current banking apps in Asia so awful and so primitive?
 
“All the banking apps that I’ve seen lack imagination and creativity – you can do only very simple and basic things on your smartphone,” he lashed out.
 
Smartphone users want better services and products, but they are also concerned about the security of such apps, Chew argued.
 
“It’s absurd that we continue to rely on passwords and PINs (personal identification numbers); it’s ridiculous that we are still relying on SMS OTP (one-time PIN) which is so inconvenient.
 
“Why hasn’t that changed in the last three years?” he said.
 
“That’s where we really need to be more creative and innovative if we are to make a big change,” he added.
 
The future of authentication will be via biometrics on the smartphone, Chew declared.
 
“We use our smartphone now to share information, and we need reliable and accurate security to do all that [banking] confidently – biometrics is the way,” he said.
 
“We cannot continue to be reliant on PINs, passwords and SMS OTPs,” he added.
 
Singapore might have been able to keep fraud low with its requirement for hardware tokens for online transactions, but it has sacrificed convenience at the altar of security, Chew said.
 
“In Singapore, we have the safest banking security in the world, and it’s based on hardware tokens – our fraud rate in online banking for many years has been zero; no other banking industry in the world has achieved that.
 
“But using a hardware token is so inconvenient – if we want to do all our banking and payments on our smartphones, we have to shift away from hardware tokens and SMS OTPs to biometrics,” he added.
 
No bank in Singapore currently offers biometrics as a form of authentication for transactions, which Chew said was surprising. Currently, biometric authentication can only be used to check account balances, but not to approve fund transfers or instructions.
 
“A biometric template is a mathematical representation of a person’s physiological characteristics, which cannot be reversed engineered or hacked, it is much stronger than encrypted PINs or passwords,” Chew claimed.
 
“It is perhaps the strongest measure we are going to have for verification,” he added.
 
READ ALSO: No more passwords? The problem with biometrics
 
The problem with humans
 

 
The concept of the self-driving or autonomous car certainly picked up momentum after the mighty Google got into the game.
 
The automobile industry has fared better than the financial industry, and is looking to adopt new technologies in a big way. And the impact goes beyond just better and cooler cars, but also includes its effects on cities and commuting.
 
Yet for all its positive outlook, the industry is facing a vast array of challenges, ranging from dealing with unpredictable elements (humans), to local customs and rule-breaking.
 
“Writing a software that takes input from road environments, not just freeways, but cities where there are pedestrians, cyclists and pets is a lot harder than driving a robot car on Mars,” said Liam Pedersen, principal researcher and manager of Autonomous Vehicles at the Nissan Research Centre.
 
“I know this because I worked on the Mars Rover, and never once in my career did I have an alien walking next to my robot,” he quipped.
 
From making last-mile transportation more efficient to maximising the use of cars, the potential is there, but is now facing the harsh reality of the road – like, how does an autonomous car avoid hitting that pedestrian?
 
“We focus on making sure we reduce the chances of that happening with high-level computational models, but hopefully the car will be able to brake first and move to the edge of any obstruction,” said nuTonomy chief operating officer Doug Parker.
 
NuTonomy is a startup which builds software for self-driving or autonomous cars.
 
And how does an autonomous car avoid carjacking or other such attacks, an all-too-real possibility in some parts of the world?
 
“Our cars in the future will be full of cameras, lasers and sensors, which will hopefully deter attackers,” Parker said.
 
For a concept that is ever-evolving like self-driving cars, it is tricky to comment on whether a human could be called upon to make a decision in the case the autonomous system is unable to do so.
 
“When the human being is not ready to drive, relaxing in his or her seat, do you really want a car to transition to manual and say ‘There’s an accident, here it is’?” Pedersen said.
 
“It is a problem that we don’t have an answer to,” he added.
 
Previous Instalment: Of AI and the human touch
 
 
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