Financial Services
From The Report: Myanmar 2018
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Myanmar’s largely unbanked population of over 53m presents vast growth opportunities, and rising demand for the newly emerging financial sector has already led to a sizeable expansion of services and investments. Enthusiasm for the Myanmar market among private domestic and international insurers has been high, as the country promises significant potential returns. With the new Yangon Stock Exchange (YSX) established as recently as October 2015, Myanmar’s capital markets are at a very early stage of development; however, the authorities are embarking upon a series of legislative and regulatory reforms. Notably, this will involve removing some of the main barriers to entry for both domestic and international players. This chapter contains interviews with U Bo Bo Nge, Deputy Governor, Central Bank of Myanmar; Neil Emerson, Senior Vice-President and Managing Director for the Asia-Pacific Region, Diebold Nixdorf; Kamalkant Agarwal, Head of International Banking Business, Siam Commercial Bank; and Daw Sandar Oo, Managing Director, Myanma Insurance; and Chairperson, Myanmar Insurance Association.

Articles from this Chapter

Overview

Inclusive ambitions: Authorities implement new reforms to incorporate more people and businesses into the formal financial sector
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As South-east Asia’s largest country and one of its richest in terms of natural resources, Myanmar’s largely unbanked population of over 53m presents vast growth opportunities. Already, rising demand for the newly emerging financial sector has led to a sizeable expansion of services and investments. In the few short years that have passed since Myanmar embarked on the path of liberalisation and democratisation, the country has attracted interest from international financial intermediaries, while…

Interview

Credibility and capacity: U Bo Bo Nge, Deputy Governor, Central Bank of Myanmar (CBM), on improving payment systems and regulations to encourage financial inclusion and facilitate foreign remittance payments
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Interview:U Bo Bo Nge How do you expect the modernisation of the payments sector to drive greater financial inclusion? U BO BO NGE: For the first time, the CBM installed a high-value payment system for those with account relationships with us. This system has operated smoothly since January 2016, handling large-value interbank payments in real time. The retail payment system using debit cards has been in operation for several years and the latest system upgrades are due to be completed in…

Interview

Old meets new: Neil Emerson, Senior Vice-President and Managing Director for the Asia-Pacific Region, Diebold Nixdorf, on how financial technology (fintech) solutions are changing traditional services
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Interview:Neil Emerson How is ATM usage developing in Myanmar? NEIL EMERSON: Some 85% of the world still uses cash, and as a growing economy Myanmar needs cash to function properly as well. As of end-2016 there were approximately 2500 ATMs installed in the country, and RBR has forecast that the installed base of ATMs over 2017-22 will have a compound annual growth rate of 13%. The usage of ATMs has continued to rise, as they provide 24/7, year-round access to cash. Transiting cash poses…

Analysis

Legislative reforms: New laws aim to align the sector with international best practices
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Over the past 15 years there has been a steady stream of new sector regulations, with each piece of legislation aligning Myanmar’s banks closer to international standards and best practices. This began in 2002 with the Control of Money Laundering Law, an important first step towards containing this problem. It also signalled to the international community that Myanmar was serious about addressing the issues behind sanctions against it. A Microfinance Business Law was passed in 2011, which was followed…

Interview

Learning from others: Kamalkant Agarwal, Head of International Banking Business, Siam Commercial Bank, on building a strong financial system
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Interview:Kamalkant Agarwal Two decades after the Asian financial crisis, is the ASEAN banking sector prepared for future shocks? KAMALKANT AGARWAL: In the aftermath, the financial systems of affected countries were reformed. As a direct consequence, today they have floating exchange rates, less reliance on short-term foreign currency debt and much more transparent financial systems which, in my opinion, is perhaps the most important legacy of the Asian financial crisis. Today, most people…

Interview

Inclusive development: Daw Sandar Oo, Managing Director, Myanma Insurance; and Chairperson, Myanmar Insurance Association, on the dynamics of a newly liberalised sector
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Interview:Daw Sandar Oo What structural changes can we expect to see resulting from a liberalised market? DAW SANDAR OO: The regulator’s objective is to create healthy competition for all parties, ultimately benefiting the Myanmar people. With a liberalised insurance market, the choice of products increases and policy prices decrease. At the same time, the regulator is focusing on the sustainability of local players. With the introduction of foreign insurers, local companies will have the…

Overview

Poised for expansion: Insurers prepare for the opening of the market
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A process of substantial reform is under way in Myanmar’s insurance industry. The sector is eagerly anticipating a blueprint for liberalisation, though this had not been published as of early 2018. Until it arrives, insurers must navigate a number of challenges, ranging from underdeveloped capital markets that only offer a narrow band of investment instruments, to the restricted consumer activity and the lack of public awareness about the benefits of life and non-life policies. The success of the…

Overview

Worthwhile trade-off: Awaited reforms set to boost stock trading activity
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With the new Yangon Stock Exchange (YSX) established as recently as October 2015, Myanmar’s capital markets remain at a very early stage in their development. As such, the bourse is subject to many of the pitfalls often found in a low-volume, frontier industry, but there is also a wealth of potential. With access to finance being one of the key pillars of economic growth, the development of a vibrant capital market is also vital. With this in mind, authorities are embarking upon a series of legislative…