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Thursday, December 2, 2021

Fintech fundraising surges in Southeast Asia after locking in on the shopping spree

As restricted consumers have turned to mobile payments and banking applications, investors have injected record amounts of money into Southeast Asian fintech companies this year.

According to data from the analysis group Refinitiv, there will be 80 fintech transactions in 2021, valued at US$3 billion-more than the total raised in 2020 and 2019.

Rohit Sipahimalani, chief investment strategist at Singapore’s state-owned company Temasek, said: “The fintech sector has taken off this year, not just financing.” “More companies are maturing and gaining momentum.”

The Philippine e-wallet company Mynt, backed by the Chinese Ant Group and a subsidiary of the local conglomerate Ayala’s Global Telecom, completed a round of financing of US$300 million this month, with a valuation of more than US$2 billion.

Singapore’s FinAccel is the parent company of Indonesia’s buy-and-pay platform Kredivo. After agreeing to merge with a blank check tool at a valuation of US$2.5 billion, it will be listed in the United States early next year.

FinAccel CEO Akshay Garg said that part of the reason for the surge in regional funding is due to Beijing’s crackdown on the technology industry, and investors are looking for alternatives outside of China. “Southeast Asia is one of the beneficiaries of China’s economic slowdown, but there is still a lot of funds available,” he added.

Southeast Asian financial technology transactions are expected to hit new highs in 2021

Strong consumer demand has also allowed many financial technology companies to quickly realize profits, which has increased the attractiveness of investors.

During the pandemic, Mynt’s registered users doubled to 51 million—almost half the population of the Philippines—and the company announced its first positive income in June.

Filipinos traditionally rely on local Saree, Or mom-and-pop shops recharge their mobile phones and conduct other prepaid transactions.

Martha Sazon, CEO of Mynt, said that only about one-third of adults in the country save money in banks, which makes them dependent on informal lending institutions, but the ownership rate of smartphones is high .

“What we are trying to do is really penetrate the rural areas of different provinces.”

Through its GCash platform, the company provides everything from loans and payments to digital insurance and investment funds. “We have promotional materials that say,’Rather than buying milk tea, it’s better to buy a fund that owns Google, Apple and Microsoft’,” Sasson said.

2C2P, headquartered in Singapore, is another regional company that hopes to raise funds after establishing a business that handles secure online payments for retailers and other organizations.

The company was established in Bangkok in 2003 to provide banks with a business-to-business online payment security system, which is now used by almost all lenders in Thailand, UOB in Singapore and BDO in the Philippines.

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Since moving to Singapore in 2008, the business has developed into a so-called payment gateway, enabling merchants to obtain payment for goods and services in multiple forms. For example, customers who purchase goods from e-commerce company Lazada can obtain a payment code at checkout, and then pay via credit or debit card, mobile banking application, or at a local convenience store.

2C2P CEO Aung Kyaw Moe said: “We have established offices in all countries, obtained regulatory approvals, and connected to all payment businesses in each country.” He added that the company hopes to conduct the first time within three years. Public offering.

Temasek’s Sipahimalani said that the new products of fintech companies are also promoting new retail investment by local investors in the capital market. “In Thailand, the number of retail brokerage accounts increased by more than one million last year,” he said.

Follow John Reed and Mercedes Ruehl on Twitter: @JohnReedwrites with @mjruehl

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