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FINA 5260
Final Exam
The Future of Financial Technology 09:00 – 12:00 hrs., May 29, 2021 Instructions for students (Online ZOOM exam) 1. This is an online, open book Exam and you can access to any materials, including course PPT and reference materials, course notes, and any books or articles to prepare the answers. 2. You should join the Zoom exam meeting at least 20 mins before the session starts, i.e. testing internet connection, battery, etc. 3. During the exam, you have to switch-on the camera all the time showing your full face and login using your student name (not nickname) so that the exam invigilator(s) can ask you questions, check your student ID, ensure you are doing the exam by yourself, etc. The exam will be fully recorded for audit purpose. 4. The exam will be uploaded to Quizzes (password protected). Password will be released to you after attendance checked. 5. You can ask any question via voice/hands-up or chat-room/hands-up (must hands-up to signal the invigilator(s)) to clarify your understanding of the exam questions or any other exam related matters. After that, you can write down your reasonable assumptions, as appropriate, when answering the exam questions. 6. Keep your Zoom audio and chat-room on all the time for any announcement during exam. 7. All your answers will be written/typed in electronic form, i.e. word doc, excel, ppt, etc. Submit (upload to Canvas) the original e-documents and a copy of them in pdf. Ensure the original copies and the pdf versions are the same. The file name should include your name and student ID, e.g. “John Smith SID 123457 – Exam Answers”. If you encounter any file uploading issue, invigilator(s) may ask student to send the file to the professor and TA’s email directly. 8. You should do the exam by yourself ONLY (No communication with any other people). Any act of dishonesty, plagiarism or copyright infringement is serious, and you will receive a FAIL grade for the course and will be further penalized in accordance with the University policies. 9. You should quote the sources/references. 10. During the exam if you need to leave for washroom, please submit all your answers in original documents and pdf copies. When you return, you can continue the exam and submit the remaining parts. 11. If you completed the exam early, you may submit all the documents/pdf copies as aforementioned. After the invigilator confirmed your submission on Canvas, you can turn-off the camera and leave ZOOM. After 11:30 hrs, no one can make early submission. 12. At 12:00, you should stop writing and save all your answers for submission to Canvas. After 12:05, no exam answer submission will be accepted. When the 2 FINA 5260 invigilator(s) confirmed receiving everyone’s e-submissions, a message will be sent out to all and you can turn-off the camera and leave ZOOM. 13. If there is any suspicion of cheating or foul play in the exam, you will be asked for a ZOOM meeting or similar verbal and/or written means to explain your answers before finalizing your grade to the School/University. 14. Mark deduction with possibility of FAIL grade will be awarded for failing to comply with the above instructions and any other instructions from the invigilator(s) during the exam. Students should prepare the following before this online exam: 15. Prepare computer (desktop computer, laptop or tablet) and mobile phone, if your computer camera cannot show your full face live. Make sure you have a stand to position your phone such that the front-facing camera can record your whole face. Install the Zoom app onto the phone. You will use your phone to join the Zoom meeting and use computer to log in to Canvas to do the exam. Make sure the devices have enough battery. This will avoid interruption between writing your exam and keeping the Zoom communication. 16. Find a location with reliable Internet connection (LAN cable is suggested to use.) 17. For proctoring purpose, no virtual background setting is allowed when using the Zoom. (Your camera should record your entire face only; and no other participants should appear in your screen during the examination) 18. You should enable pre-approved consent to be unmute. This will allow exam invigilators to check up on student’s exam environment. 19. Please join the Zoom meeting at least 20 minutes in advance before the exam. Students who encountered internet or technical problem should communicate with Faculty/TA before the exam begin. No extra time for students if the internet disconnected or encountered any technical problems. 3 FINA 5260 There are Part I and Part II in this exam: Part I (Q1 – Qxx) – Answer all the questions (xx marks) Part II (Qxx – Qxx) – Choose any i out of j questions to answer (xx Marks) Part III (Qxx – Qxx) – Choose any k out of l questions to answer (xx Marks) You should answer a total of xx questions (max score of xxx marks) for this exam. Part I (Q1 – Qx) – you have to answer all the questions (xx marks) Q1 (10 marks) (a) What are the differences between virtual banks and traditional banks with online banking services? (b) Give 2 distinctive ways to implement the solution for “bank account opening” with a virtual bank, i.e. customers do not need to physically visit the branch office. [Hint: How to establish your “real” identity online?] (c) After (b) is completed, how to establish digital authentication for online financial services? (d) …… Q2 (10 marks) (a) Explain “low-end footholds” and “new-market footholds” in Disruptive Innovation (b) Is Tesla “disruptive innovation”? Justify your answer. (c) Is WeChat disruptive innovation? Justify your answer. (d) Describe the differences between pipeline and platform-based business model (e) …. Q3 (10 marks) (a) Explain why “Sandbox” is so important for FinTech startups/projects? (b) Which country’s “Sandbox” favors FinTech startups? Why (c) ….. 4 FINA 5260 Part II (Qxx – Qxx) – you can choose to answer i out of j questions (xx marks) Q 10 (20 marks) Ant Financial (a) What is ……? Give an example for each respectively. (6 marks) (b) What was the “win-win” solution for ……? (4 marks) (c) What factors contributed to the successful diversification of ……? (4 marks) (d) Give examples of …… and ….. (4 marks) (e) From the BITD model, identify …….. (12 marks) Q7 (20 marks) Tencent (a) Apply BIDT and LoNG PESTEL analysis to Tencent and identify six imminent challenges (problems/opportunities/threats/risks) that the company was facing: (6 marks) Tencent Business Innovative Integration Data Technology Political Economical Social Technological Environmental Legal (b) Describe the revenue model of Tencent. (4 marks) (c) How would you address these challenges? (4 marks) (d) Propose how should Tencent expand in overseas markets? (6 marks) 5 FINA 5260 Part III (Qxx – Qxx) – you can choose to answer k out of l questions (xx marks) Q12 (40 marks) P2P Lending – Funding Circle case 1. Govt guaranteed SME loans (100%; 90%; 80%) 2. Why Govt wants to support SMEs? Use PESTEL analysis (4 marks) 3. Banks will screen and approve the SME loans. Why? Any alternatives? (2 marks) 4. Banks were NOT very effective/enthusiastic because …….. (class discussion refers) (4 marks) 5. Business objectives: Provide loans to SMEs; Provide alternative investments to lenders/investors; Match borrowers with lenders/investors. 6. Design a more effective P2P lending platform: (a) A simple matching platform listing borrower’s info such as xxx, yyy, zzz, etc. for investor(s) to decide and choose, then charge a fixed fee or % of the loan amount, (b) Use (open API)/build a risk assessment engine to segregate the loan amount into different sizes according to its risk and match accordingly with different investors’ risk appetite, or (c) propose your business-IT design Which P2P lending platform design in (a), (b) or (c) you prefer? Explain your answer. (8 marks) 7. Is your FinTech solution “disruptive innovation”? Why or why not? (2 marks) 8. With Govt as guarantor (100%; 90%; 80%), how would you incorporate this offer/incentive into your P2P lending platform? (6 marks) 9. What are the data or data source(s) with the use of open APIs or other technologies that could attract investors/lenders, increase revenues, profits and/or the usage of your P2P lending platform? (4 marks) 10. Propose a new business-IT design for the P2P lending platform using DLT/BlockChain. (8 marks) 11. Put aside the legal/regulatory constraints, propose how you can improve the liquidity of the loans? (2 marks)