Trade Wars and Fintech

Trade wars are often viewed through the lens of tariffs, manufacturing and geopolitics. But beneath the headlines of retaliatory duties and disrupted supply chains lies a quieter casualty: fintech.

- LITO VILLANUEVA

It's easy to assume that financial technology, built on bits and code, would be immune to the fallout of protracted trade conflicts. After all, fintech thrives in the cloud—borderless, decentralized and agile. But make no mistake: when global economies go into protectionist mode, digital finance doesn't escape unscathed. It gets entangled, slowed down, and sometimes, left behind.

I've seen this unfold up close—from global forums where we discuss open finance collaboration, to rural barangays where we extend inclusive banking such as the RCBC ATM Go or offer digital credit to unbanked and underserved communities. The ripple effects of global tensions aren't just felt in boardrooms. They land in remittance corridors, fintech developer hubs and digital wallets or accounts on the phones of everyday users.

So how exactly does a trade war—prolonged and deeply political—shape the trajectory of fintech?

Let's unpack it.

Fintech's biggest promise is interoperability. But trade wars lead to its exact opposite: fragmentation. When countries begin to view data, digital platforms, and even cloud infrastructure as instruments of national sovereignty, global standards break down. We saw this in the growing push for "data localization" laws, barring financial data from leaving domestic borders—often in response to geopolitical mistrust.

This doesn't just disrupt big banks or multinational tech firms. It deeply affects small fintech startups trying to scale cross-border services. Open banking APIs, digital identity verification, and fraud analytics rely heavily on seamless data exchange. The moment you insert political firewalls, innovation stalls.

Too often, it becomes an ideal sidelined by realpolitik. But for me, that tension between aspiration and reality sparks a different kind of excitement—a reminder of where I came from, and how it all comes full circle.