Fintech Firms Target Southeast Asia’s Youth as Digital Demand Grows

With more than three-quarters of Southeast Asian consumers now using e-wallets, the financial services landscape is evolving rapidly.

At the intersection of this digital shift stands Abdul Mikael, chief operating officer at AND Solutions, a fintech firm working to close the financial inclusion gap through artificial intelligence and automation.

In an exclusive interview, Mikael discussed how changing consumer habits, AI-powered tools, and strategic partnerships are transforming the region’s financial infrastructure.

“The younger generations are digital natives. They don’t just expect financial tools to be convenient — they expect them to be invisible, integrated, and immediate,” Mikael said. “Whether it’s in the Philippines or Vietnam, digital behaviors are being driven by a global perspective and shaped by platforms like TikTok.”

REDEFINED ENGAGEMENT

In countries like the Philippines, where cash still accounts for more than half of daily transactions, young consumers are nevertheless accelerating the adoption of digital wallets, QR payments, and mobile-first solutions.

Mikael attributes this trend not only to convenience but also to broader behavioral shifts tied to globalization, mobile connectivity, and digital literacy.

What once began as an effort to reduce in-person bank visits has evolved into a movement toward financial ecosystems embedded within e-commerce and social media platforms. Mikael pointed to live commerce innovations, particularly on TikTok, as an example of how fintech is seamlessly integrating into everyday life.

“Today, if a TikTok influencer is promoting a product, the user can immediately view it, learn about it, and complete the purchase on the same screen — all without switching platforms,” he explained. “This is embedded finance in action.”

Buy Now, Pay Later (BNPL) services also reflect this evolution, Mikael added. By layering in automated credit scoring, these tools not only simplify purchases but also broaden access to credit — a vital shift in a region where millions remain underbanked.

Traditional Banks Face Structural Hurdles

While fintech firms rapidly innovate, legacy banks often find themselves struggling to adapt. Mikael outlined the entrenched challenges banks face, including regulatory constraints, massive IT infrastructure, and resistance to operational change.

“A traditional bank wanting to implement a new digital solution is facing a multi-year, high-cost undertaking,” Mikael said. “Then comes internal training, customer onboarding, and regulatory oversight. It’s a huge lift.”

Rather than pushing banks to overhaul their core systems, AND Solutions provides modular tools that plug into existing infrastructure. “We offer faster, cheaper integration,” he said. “Our Loan Origination System (LOS) works with what they already have — we don’t ask them to tear down the house.”

Collaboration Over Competition

Despite early fears that fintech would disrupt and displace traditional financial institutions, Mikael believes the future lies in collaboration. He sees growing interest among banks in adopting agile, tech-driven approaches — particularly when the end goal is financial inclusion.

“One of the biggest trends right now is the partnership model — fintechs teaming up with banks to better serve the underbanked,” he said. “Fintechs bring speed, flexibility, and data insights. Banks bring trust, scale, and compliance experience. Together, they can do much more.”

One area of promise is data sharing between the two sectors. Fintechs that have built behavioral profiles of customers through years of engagement can share those insights with banks to help design tailored credit products.

“These partnerships are already expanding access to loans and other services in ways that were impossible five years ago,” Mikael said.

AI as the Great Equalizer

Among the innovations Mikael sees as game-changers, intelligent document processing (IDP) stands out. AND Solutions’ flagship product, mindox, automates document review and data extraction — cutting application processing time dramatically.

“Last year, we were the only company presenting IDP at a regional conference,” he said. “This year, a third of the exhibitors are offering it. The market is catching up fast.”

Another area poised for disruption is customer service. AI-powered agents trained to resolve specific financial queries can replace long wait times with instant answers — an increasingly crucial feature for digital-first consumers.

“These agents can be repurposed across a range of functions,” Mikael said. “Support, onboarding, fraud detection — it’s scalable and efficient.”

Southeast Asia’s Digital Advantage

Compared to legacy banking systems in Europe and North America, Southeast Asia enjoys an unlikely advantage: late-stage adoption. Countries like Indonesia, Vietnam, and the Philippines have leapfrogged outdated infrastructure and built fintech ecosystems from the ground up, Mikael said.

“Many Southeast Asian banking systems are new enough that they started with modern frameworks,” he noted. “In contrast, banks in Europe are still dealing with Y2K-era backends.”

The region’s young, mobile-first population further accelerates this advantage. “You’re talking about a generation that grew up on smartphones and expects real-time everything,” he said.

This demographic reality, coupled with regulatory evolution and investor interest, positions Southeast Asia as a testing ground for the next generation of digital finance.

Rethinking Risk and Credit

To reach underserved populations — especially younger people without traditional credit histories — fintechs are pioneering new approaches to credit scoring. At AND Solutions, the Custom Credit Scoring platform leverages AI to analyze non-traditional data such as mobile behavior, digital transactions, and alternative documentation.

“Younger users might not have a long credit trail, but they have digital footprints,” Mikael explained. “Our AI-based models help turn those footprints into reliable credit assessments.”

By doing so, lenders can offer financial products to a broader customer base, without relying solely on outdated credit bureau models.

The WhatsApp Effect: Meeting Users Where They Are

Another key to AND Solutions’ strategy is meeting consumers on platforms they already use. That includes leveraging communications apps like WhatsApp and Viber — ubiquitous tools in Southeast Asia — for customer acquisition and support.

“People use these platforms daily, sometimes hourly,” Mikael said. “By offering financial tools through them, we’re eliminating barriers to entry. No new app download, no new account needed.”

It’s a strategy that reflects AND Solutions’ overarching mission: to make digital finance not just accessible, but intuitive and invisible.

A Three-Pronged Product Strategy

AND Solutions’ offerings are built around three core platforms:

1. looms – A fully digital loan origination platform that streamlines everything from onboarding to underwriting, compatible with legacy bank systems.
2. mindox – An intelligent document processing (IDP) tool using AI, machine learning, and natural language processing to automate data extraction and verification.
3. Custom Credit Scoring (NIKO) – A predictive analytics engine using alternative data for credit risk assessments, especially for the underbanked and credit-invisible populations.

“These tools aren’t just for tech-savvy millennials,” Mikael emphasized. “They’re designed to serve anyone seeking faster, fairer access to financial services.”

Regulation as the Next Frontier

While the technology is ready, Mikael said meaningful change will require more agile regulatory frameworks. He pointed to the slow pace of reform as a primary obstacle to broader adoption.

“Banks are not unwilling to innovate,” he said. “But they operate under intense scrutiny. Until regulators offer more flexibility, the pace of transformation will remain uneven.”

Still, Mikael is optimistic. He believes that success stories — particularly those demonstrating expanded inclusion and efficiency — will ultimately push regulators toward modernization.