Taipei: Financial technology (FinTech), including stablecoins, could help accelerate the movement of funds across global semiconductor and AI supply chains, allowing manufacturers to operate more efficiently, industry leaders said Tuesday. Speaking at a media briefing in Taipei ahead of the second edition of the Asia FinTech Alliance (AFA) Summit, AFA Chairwoman Jaclyn Tsai emphasized Taiwan's critical role in semiconductor and AI server manufacturing, asserting that the rapid pace of production necessitates equally swift financial transactions.

According to Focus Taiwan, Tsai highlighted that merely accelerating the movement of goods is insufficient without a corresponding speed-up in financial transactions. She noted that FinTech has the potential to enhance supply chain efficiency and bolster the competitiveness of manufacturing economies. Etron Technology Inc. Chairman Nicky Lu supported Tsai's perspective, emphasizing the importance of speed for tech companies operating across various time zones, where banking and settlement hours could impede transactions. Lu explained that delays in financial processing could disrupt production, deliveries, suppliers, and customers across multiple countries due to banking cut-off times.

Lu pointed out that in Taiwan, the 3:30 PM banking cut-off significantly affects semiconductor transactions, forcing companies to wait until the following day. He stressed the need for a faster financial infrastructure capable of maintaining "security, reliability, and resiliency."

During a Q and A session, Tsai discussed how emerging technologies such as AI, blockchain, and virtual assets could enhance manufacturing and supply chain efficiency. She noted that regulatory approaches across Asian economies are aligning, creating opportunities for greater interoperability in areas like stablecoins and cross-border payments. Stablecoins, digital tokens designed to maintain a stable value by pegging to a fiat currency, could play a crucial role. Taiwan's Legislature recently passed the Virtual Asset Services Act, establishing a legal framework for stablecoin issuance.

Tsai explained that the framework might allow both Taiwan dollar and foreign currency-backed stablecoins, though a decision on which will be more widely issued is pending. She illustrated their potential in supply chains, envisioning a scenario where a Taiwanese company receives a U.S. dollar-backed stablecoin from an overseas customer and converts it into a Taiwan dollar-backed stablecoin to pay suppliers and employees. She predicted that stablecoin payments could become more prevalent as early as next year, providing a "new rail" for settlement alongside traditional payment systems.

Founded in 2023, the AFA unites FinTech associations from 16 Asian economies, fostering cross-border collaboration, regulatory dialogue, and financial innovation. The inaugural AFA Awards will occur in Taipei on Sept. 1, followed by FinTechOn 2026 and the second edition of the AFA Summit on Sept. 2-3, focusing on virtual asset and FinTech regulation, global supply chains, cross-border payments, and AI.