Financial institutions are championing the use of artificial intelligence, arguing the new technology can rapidly accelerate tasks like “know-your-customer” checks, customer onboarding, and document processing. 

Advancements like these can drive customer acquisition and boost employee productivity, all good for the bottom line. “AI has been a game-changer in how we provide international payment and financial services. In 2024, we processed more than $1 trillion in global transactions, all supported by AI,” says Tianyi Zhang, a general manager of risk management and cybersecurity at Singapore-based Ant International.

Yet while AI presents an opportunity for financial firms like Ant International, it also poses risks. Bad actors can exploit AI advancements to intensify the threat of scams and fraud against both clients and financial institutions. 

Zhang, in particular, is worried about deepfakes, “perhaps the most well-known examples of AI-generated risks.”

“In some markets, we have found that more than 70% of new enrolments may be deepfake attempts,” he notes. “We’ve identified more than 150 types of deepfake attacks.”

Last year, Microsoft warned that AI-generated deepfakes are now highly realistic and increasingly simple for anyone to produce. The company flagged that deepfakes were now increasingly being used in fraud, and called for new legislation to curb bad actors from using these technologies. 

Deepfakes can be a challenge for financial institutions like Ant International, which need trusted identities to be able to carry out know-your-customer checks to comply with anti-fraud and anti-money laundering legislation.

For example, cybersecurity experts say that North Korean IT workers use deepfaked identities to get jobs at leading tech firms and funnel earnings back to the isolated country. 

‘Enhanced security’

Ant International is the international wing of Ant Group, the fintech affiliate of e-commerce giant Alibaba and operator of the ubiquitous Alipay payments app. In 2024, Ant Group set up Ant International as an independent business unit with its own board. 

Ant International operates Alipay+, Antom, Bettr, and WorldFirst, and is present in more than 60 markets globally. The company facilitates services like payments, cross-border transactions, and lending.

Zhang said AI helps Ant International deliver “greater efficiency” and “enhanced security” to its 100 million merchant customers worldwide, most of which are small and medium enterprises.

To combat new threats from AI, Ant International is focusing on three areas: investing in security and AI, building expertise and fintech-specific knowledge banks, and expanding its business-to-business AI products. 

Zhang points to Alipay+’s GenAI Cockpit Platform, which gives fintech firms, banks and superapps real-time risk assessment, among other services. Ant International claims the platform combats hallucinations and other data risks by using over 100 recognition models and 600,000 risk lexicons.

Ant International is also gearing up to launch EasySafePay 360, an account protection program for Alipay+, in the coming months. This platform will leverage AI to manage risk and safeguard transactions, as well as offer a money-back guarantee for transactions deemed to be unauthorized.

The company hopes the platform will facilitate the growing number of cross-border payments, spurred by global travel. Ant International, citing external research, estimates that the gross cross-border travel services market could reach $1.8 trillion by 2028.  

This story was originally featured on Fortune.com

© Courtesy of Ant International

Strong second quarter results sent shares of Sea, the Singaporean tech company, up 19% in New York trading on Tuesday. Shares are now up more than 60% for the year thus far, even as shares are still far from their 2021 highs. 

Sea reported revenue of $5.3 billion for the quarter ending June 2025, an almost 40% jump year-on-year. Net income also reached $414.2 million, more than five times greater than the $79.9 million profit recorded a year ago.

All three of Sea’s business divisions—e-commerce platform Shopee, video game developer Garena and fintech unit Monee—posted double-digit percentage point revenue growth. 

“The momentum from our strong start to 2025 has continued into the second quarter. All three of our businesses have delivered robust, healthy growth, giving us greater confidence of delivering another great year,” said CEO Forrest Li in prepared remarks.

Shopee, the leading e-commerce platform in Southeast Asia and Taiwan, is still the biggest contributor to Sea’s business, contributing 72% of total revenue. Shopee’s gross merchandise value grew 25% over the first half of the year compared to 2024. 

Monee, Sea’s recently rebranded financial services arm, also maintained strong growth. Its loan book expanded by 94% year-on-year last quarter, reaching $6.9 billion.

Sea’s success

Sea, No. 15 on the Southeast Asia 500, has now recorded two straight years of profit, a milestone for the company after a period of painful cost-cutting and restructuring.

In previous earnings calls, Li credited AI tools and its logistics network for improving profitability in Sea’s e-commerce department.

On Wednesday, Li said that Sea has “reached a stage where we can pursue growth opportunities while improving profitability.”

One such growth opportunity is Brazil. Shopee expanded to Brazil in 2019, and is now one of the country’s leading e-commerce platforms. In a call with analysts, both Li and CFO Tony Hou were bullish on Sea’s prospects in Brazil. 

Hou said that Sea had “meaningful room” to grow in Brazil, even as competitors like PDD Holdings’ Temu and ByteDance’s TikTok entered the market. Li also pointed to Brazil’s potential as a market for Sea’s financial services business, pointing to “very good growth” in loan book value for the second quarter. 

This story was originally featured on Fortune.com

© Cheng Xin—Getty Images

In recent weeks, there have been viral images from the Philippines show couples exchanging wedding vows in flooded churches after Tropical Storm Wipha made landfall in late-July. The storm swept through southern China and central Vietnam, with heavy rain causing flooding in both locations. 

Vietnam and the Philippines are used to periods of intense rain, but climate change threatens to make these events more severe. Southeast Asia as a whole faces an escalating climate risk, due its densely populated cities, frequent heavy rain, and insufficient infrastructure.

Recent modelling from Zurich Resilience Solutions found that six major cities in Southeast Asia—Singapore, Bangkok, Ho Chi Minh City, Jakarta, Kuala Lumpur, and Manila—all face at least a “high risk” of extreme precipitation, heatwaves, and rising sea levels through the 2040s. 

In particular, the modelling noted that Manila, Bangkok, Singapore, and Jakarta are among Southeast Asia’s most climate-vulnerable cities, with critical infrastructure facing high exposure to multiple climate hazards.

Zurich’s risk modelling used data points from seaports, airports, and notable cultural sites, like Bangkok’s Grand Palace and Manila’s Fort Santiago. The analysis was conducted under the SSP2-4.5 scenario, a widely used projection developed Intergovernmental Panel on Climate Change. The “middle-of-the-road” pathway assumes moderate global mitigation efforts and anticipates a two degree Celsius increase in global average temperatures between 2041 and 2060.

“In Manila, sites are at severe risk from extreme precipitation, storm surge, sea level rise, and flooding, threatening trade and cultural preservation,” the report’s authors wrote. Both Bangkok and Jakarta are also threatened by worse flooding from climate change. 

Zurich notes that governments are already investing to address some of these risks. For example, its report highlighted that Singapore added another 5 billion Singapore dollars ($3.9 billion) to its coastal and flood protection fund this year to support new infrastructure like detention tanks, widened canals, and elevated platform levels. Ho Chi Minh City is also upgrading its drainage systems and expanding green urban spaces to curb local flooding. 

Not investing in mitigation could result in severe financial losses. A recent report from the World Economic Forum and Singapore International Foundation estimates that the impact of climate change could reduce Southeast Asia’s GDP by up to 25% by 2050. 

Another study from Oxford Economics estimates that a 1% increase in average temperatures could raise food prices across Vietnam, Thailand, Malaysia, Indonesia and the Philippines.

Businesses in the region are also taking notice of how climate change’s financial cost could hit their own operations. 

City Developments Limited (CDL), No. 139 on the Southeast Asia 500, estimated in 2023 that climate inaction could cost 120 million Singapore dollars ($93.2 million) by 2030, equal to almost 4% of its 2024 revenue. CDL is working on another climate scenario study to be published later this year. 

This story was originally featured on Fortune.com

© Ted Aljibe—AFP via Getty Images

Singapore’s biggest banks are bracing for macroeconomic uncertainty following mixed quarterly results. 

DBS, Southeast Asia’s largest bank, delivered a good quarter. On Thursday, the bank reported profits of 2.82 billion Singapore dollars ($2.2 billion) for the quarter ended June 2025, a 1% increase year on year that beat consensus estimates. Robust lending and wealth management fees drove DBS’s total income up by 5% year on year, hitting 5.8 billion Singapore dollars ($4.47 billion).

Yet fellow Singaporean bank UOB, which released its quarterly results on the same day, reported a 6% drop in quarterly profit to 1.34 billion Singapore dollars ($1.04 billion) as net interest income weakened.

OCBC, which reported last week, also had its quarterly profit decline by 6% to 2.34 billion Singapore dollars ($1.82 billion). As with UOB, falling net interest income weighed on OCBC’s performance. 

The three banks, the largest by revenue in Southeast Asia, are not only grappling with declining interest rates, but also warning of a more uncertain economic outlook. 

In a statement, UOB CEO Wee Ee Cheong expressed confidence in Southeast Asia’s long-term prospects despite global polarization. UOB has the greatest exposure to Southeast Asia among the three major Singaporean banks. 

“As the global landscape transitions towards a multipolar world order, ASEAN continues to demonstrate resilient growth. With regional integration, trade diversification, and rising foreign direct investments, ASEAN is well-positioned to thrive in the evolving global economy,” Wee said in the statement.

Yet UOB’s CEO also warned that new U.S. tariffs could dampen consumer sentiment and investment activity. 

Outgoing OCBC CEO Helen Wong also highlighted a challenging macroeconomic outlook in her earnings statement last week. “Evolving trade and monetary policies and persistent geopolitical tensions are expected to weigh on growth prospects,” she said.

Tan Su Shan of DBS, speaking after her first full quarter as the bank’s new CEO, acknowledged “external uncertainties,” though added that “proactive management” of the balance sheet will help DBS navigate the interest rate cycle.

Tariffs and interest rates

The interest rate hikes that began in 2021 are now easing. The U.S. Federal Reserve cut rates by a percentage point over the second half of 2024, and could cut rates further following weak employment growth in the U.S. 

The European Union and China started to ease their monetary policies last year as well. The Monetary Authority of Singapore, the city-state’s de facto central bank, also loosened its monetary policy earlier this year.

Banks profit from higher interest rates by earning more on loans and attracting additional deposits.

Beyond falling interest rates, Singapore’s three banks must also navigate higher U.S. tariffs. Trump’s new tariffs on U.S. trading partners go into effect today. Singapore escaped the flood of new taxes, with its exports just getting the baseline 10% tariff on all U.S.-bound exports.

Yet Singapore’s neighbors are more deeply affected: Southeast Asian economies like Thailand, Indonesia, and Vietnam received tariffs of around 19% to 20%.

Other Asian economies will feel the impacts even more. China, a major market for both DBS and OCBC, now faces a combined U.S. tariff of 55%, though some of those taxes are paused to allow for trade negotiations. India, another target market for DBS, faces a steep tariff of 50%. 

While tariffs won’t directly affect DBS, UOB, or OCBC, a broader tariff-driven economic slowdown will dampen consumer sentiment and curb investment activity, reducing business opportunities for Singapore’s globally connected banking sector.

This story was originally featured on Fortune.com

© Ore Huiying—Bloomberg/Getty Images