A decade ago, Manila was a testing ground for fintech. Lei Chen, Vice President of Chinese fintech company FinVolution Group, recalls that when the company first entered Southeast Asia in 2018, the local internet lending sector was still in its infancy. (fintechfutures.com)
“Market demand was high, yet the supporting infrastructure, credit reporting systems, and regulatory frameworks were still in the early stages of development,” he said on the sidelines of the 2025 Singapore FinTech Festival (SFF) being held this week.
These were among the first challenges that complicated the deployment methods FinVolution had worked on for years.
Localisation drive
Simply replicating its existing know-how and methods wouldn’t work. Instead, FinVolution committed to an approach centred on local insights and expertise.
“We consistently believe that technology must be adapted to local regulatory requirements, data ecosystems, and user behaviours,” Chen stressed.
Since setting up shop in Southeast Asia, FinVolution has established technology and operations teams led by local employees while maintaining close communication with regulators to advance industry development.
These efforts paid off, with regulators in Southeast Asia encouraging responsible technological innovation to create a more open and inclusive environment for fintech companies operating in this region.
Over time, FinVolution has deeply integrated technologies like AI into all aspects of the company’s Southeast Asian operations—from customer identification to credit decisioning, post-loan management, and customer service—enabling fully intelligent end-to-end operations.
“AI has evolved from early predictive analytics to include generation, reasoning, and decision-making capabilities,” he said.
“Large language models (LLMs) now can facilitate multi-language customer interactions, generate intelligent risk insights, and provide personalised financial services, while proprietary deepfake detection capability strengthens financial security.”
Southeast Asia presents specific challenges compared to more mature domestic markets, particularly in financial infrastructure, data, and identity systems.
“For example, facial recognition models must be retrained locally to account for differences in skin tone, lighting, and photography habits,” Chen explained.
Data governance
Moreover, in the Philippines, where the “know your customer” process can be hampered by the absence of a unified ID system, FinVolution’s “One Face ID” solution has emerged as a fix. It links multiple types of ID documents to a single facial identity, helping banks verify user identities more efficiently.
Another tailored innovation is FinVolution’s “Blu” intelligent voice bot. It adjusts for telecom infrastructure and local user habits, allowing rapid deployment across borders.
Such adaptations prove essential to ensure accuracy, reliability, and user trust in AI-driven financial services. In the context of Southeast Asia, a key limitation in the financial infrastructure was the scarcity of personal credit records, making it difficult for banks and other financial institutions to assess a borrower’s creditworthiness and predict default risks.
FinVolution saw huge opportunities in addressing this missing piece of the financial jigsaw puzzle. To do so, the company applies privacy computing and federated learning technologies to protect user data while responsibly using it for credit evaluation.
This approach strengthens privacy protection, helping guide the industry toward higher standards and greater self-discipline in the safe and responsible use of data, Chen explained.
This track record earned FinVolution recognition from local partners and regulators alike. In 2024, the company secured a credit bureau licence in the Philippines. This paved the way for the launch of its JuanScore intelligent scoring system under the supervision of Credit Information Corporation (CIC), the country’s official credit data registry.
According to Chen, JuanScore integrates data covering roughly 70% of the country’s unbanked population and leverages over 50 localised models. It provides financial institutions with smarter, safer credit decision support and advances financial inclusion.
Financial inclusion
The broader Southeast Asian fintech ecosystem has matured significantly over the past decade. Dong Shou, founder and CEO of Singapore-based fintech unicorn Advance.AI, notes that internet penetration rose from 40% to 75% over the past decade, allowing the region to leapfrog the PC era into mobile-first connectivity.
Yet growth remains uneven: Singapore and Malaysia exceed 80% penetration, while Cambodia and Laos, for example, lag behind.
Shou’s entrepreneurial journey began in 2016, after a conversation with a taxi driver in Jakarta who was paying a substantial amount of interest on loans taken to cover treatment for his ill daughter.
“Indonesia’s financial services were largely dominated by a few major banks. These banks tended to focus on high-quality clients and generally did not lend to ordinary individuals who lacked credit histories or collateral,” he said.
Advance.AI tackled the challenge by first helping financial institutions build credit profiles using data gathered through business-to-business partnerships with telecoms and enterprises. Its services then gradually extended to ordinary citizens seeking loans and other financial services like buy now, pay later (BNPL).
In what has now become a widely shared story, digital credit cards and e-wallets rapidly filled the voids left by traditional banks. Virtual banking stepped in and thrived where brick-and-mortar outlets could not reach. This fuelled a fintech boom.
Shou said the online lending market in Southeast Asia is projected to surpass $100 billion by 2025, growing at a 30% annual rate.
Today, platforms such as Gojek, Grab, Shopee, and Lazada deeply embed into local users’ payment habits, serving as engines of a digital transformation sweeping Southeast Asia.
“Moving forward, firms capable of embedding into local financial service scenarios and offering reliable technical foundations will have a decisive advantage as the market matures,” Shou said.
AI: from prediction to partnership
Apart from a bigger push in localisation, the advent of AI technologies, especially generative AI chatbots and LLMs, has tremendously expanded the toolkit for fintech players. This allows them to engage more deeply with local markets while ensuring compliance and responsible practices.
At the 2025 SFF, Chen noted that FinVolution’s AI investment started in 2016, initially focused on predictive modelling and optimisation. Today, LLMs enable reasoning, generation, and decision-making.
Intelligent customer service uses multi-language AI to interact naturally, identify customer intents in real time, and generate personalised solutions. Meanwhile, risk models learn market changes autonomously and adjust strategies dynamically.
Chen said AI is ushering Southeast Asian fintech into a new phase—moving from “scale competition” to a combination of trust and intelligence.
Looking ahead, he said FinVolution will continue to deepen its presence in key Southeast Asian markets while exploring additional countries.
The company plans to collaborate closely with regulators to build sustainable and replicable digital financial models. “We believe technological innovation combined with regulatory collaboration will create a safer, more inclusive regional financial ecosystem,” Chen explained.
Reflecting on the past seven years, he said firms like FinVolution have been lucky to bear witness to the rapid growth of the Southeast Asian fintech ecosystem.
As e-commerce, credit, and payment sectors thrive, and financial literacy and regulatory frameworks improve, firms like FinVolution not just stand to benefit from, but will continue contributing to the ongoing pivot to digital finance.
“With AI and LLMs continuing to evolve, we believe Southeast Asia will remain one of the most vibrant fintech innovation hubs globally, and we will continue using technology to promote financial inclusion in this region,” he said.
