Southeast Asia’s digital banking battle is entering a new round. Attracting customers with slick apps, quick onboarding and promotional rates is one thing, but keeping them and turning that growth into profit is another. Platform banks could have the upper hand by combining financial services with ecosystems people already use, backed by behavioural data and artificial intelligence.
Why platform banks gain ground
Malaysia shows how quickly digital banking has expanded, with all five licensed digital banks operating by the end of 2025. Together, they served 2.4 million customers and held RM4.2 billion in deposits, while around 65% of customers came from unserved or underserved groups, according to Bank Negara Malaysia.
However, Wendell Tan, principal at Arthur D. Little’s Financial Services practice, argues that the next test is whether these banks can retain customers after promotional incentives disappear and expand lending without taking on excessive credit risk.
Platform banks may have an advantage because financial products can be integrated into services people already use. Thailand’s virtual banking approvals include the consortium of Krungthai Bank, Advanced Info Service and PTT Oil and Retail Business behind CLICX.
Indonesia offers another example through Grab’s integration of Superbank into its wider ecosystem. Frequent customer interactions can provide richer transaction data, potentially improving lending decisions and lowering distribution costs. Superbank reached profitability in FY2025.
How AI changes competition
AI could strengthen this platform advantage, although Tan argues that the technology itself is unlikely to become a lasting competitive moat. Cloud systems, digital onboarding, analytics and increasingly capable AI models are becoming widely available throughout the banking industry. More important advantages could come from permissioned customer data, strong governance, balance-sheet capacity and established relationships.
Banks should therefore focus on secure, consent-based data systems while embedding finance where customers need it. Connecting AI with lending policies, frontline workflows and risk monitoring could ultimately separate banks that merely deploy the technology from those that actually make money from it.
