Billionaire Jack Ma’s Ant Group soft launches its digital financial services bank in Singapore

Billionaire Jack Ma’s Ant Group Co. launched its digital bank in Singapore, as China’s biggest online financial platform branches out of its home market amid regulatory headwinds. Micro, little and medium endeavors (MSMEs) can now go to ANEXT Bank, a wholly-owned subsidiary of Ant Group, to address their digital financial services needs.

NEXT Bank will offer digital financial services to micro, small and medium-sized enterprises, particularly those with cross-border operations, it said in a proclamation on Monday.

The Singapore-put-together digital bank will concentrate on providing digital financial services to local and regional MSMEs, particularly those participating in cross-border operations for growth and global expansion.

One such service is the ANEXT Business Account, a dual-currency deposit with exclusive safety efforts, including a three-factor confirmation check and features like remote onboarding and daily interest. It will be accessible to the overall SME community from Q32022.

“Amid rapid acceleration in the digital economy, business models are changing and pivoting to become digital-first, if not adopting a hybrid model. Financial services have to evolve and be where SMEs are doing their businesses digitally,” says Toh Su Mei, chief executive officer of ANEXT Bank.

She continues: “We are well-positioned to live up to this vision, leveraging Ant Group’s deep bench of technologies and know-how, along with our customer-obsessed local team dedicated to serving the SME community.

“Adopting an open and collaborative approach, we believe in joining hands with industry partners and the public sector to provide SMEs with financial services that are simpler, safer and more rewarding.”

The fintech giant is entering an arena overwhelmed by customary incumbents including DBS Group Holdings Ltd. what’s more, Oversea-Chinese Banking Corp. Involving Singapore as a base for its business in Southeast Asia might counterbalance more slow development possibilities at home after government-ordered regulatory overhauls. Part-owned by Alibaba Group Holding Ltd., Ant can likewise profit from the e-commerce operator’s unit in the region, Lazada.

“Banking services are essentially a very central part of the holistic suite of financial services that we’re doing within Southeast Asia and hopefully using Singapore as a launchpad,” Toh Su Mei, chief executive officer of ANEXT Bank, said at a news briefing.

Asked about staffing, Toh said the wholly owned bank will build a “Singapore-first team,” with 75% of workers based in the city-state and the rest in China.

Toh, a former executive at DBS, has over 20 years of experience in the banking industry. She led DBS’s lending arm for small and medium-sized endeavors in the region before to joining Ant, as per her LinkedIn profile.

The digital bank is beginning by offering a see of its dual-currency deposit account, which incorporates a three-factor authentication verification, remote on-boarding, and everyday interest, it said. Accounts will be made accessible from the second to last quarter.

Toh said the bank will offer interest rates that are in line with the market. “We are not here to create a price war,” she said.

Local Partner: Partnering with Proxtera to make marketplaces more efficient

Ant was one of two groups to get a wholesale digital banking license in December 2020, permitting it to serve little and moderate-sized firms and other non-retail segments. It requires a capital responsibility of S$100 million ($73 million). That contrasts and a fully digital bank license, which can serve a wide range of clients and in the end requires S$1.5 billion in the capital as well as local control.

Ant will also partner with Proxtera, a nearby element that is important for a public initiative led by the Monetary Authority of Singapore and Singapore’s Infocomm Media Development Authority, to make an open framework for coordinated efforts with financial institutions.

As a component of its open and cooperative approach, ANEXT Bank has signed a two-year MoU with Proxtera – the substance upheld by MAS, the Infocomm Media Development Authority (IMDA), and private sector entities.

The move aims to change and enable holistic cross-border trade among SMEs and businesses by making marketplaces efficient and discoverable globally, with embedded financing, fulfillment services, and SME empowerment.

Under the arrangement, the two organizations will jointly create and establish an open framework for all participating financial institutions as they provide financing and risk mitigation support for SMEs and platforms in global trades.

NEXT Bank will likewise be Proxtera’s first participating digital wholesale bank in Singapore to lead how in giving financing solutions to the buyers and sellers on Proxtera’s network.

Saurav Bhattacharyya, chief executive officer of Proxtera, says: “Seamless access and availability of trade financing solutions will help amplify business growth and accelerate expansion for SMEs.

“Proxtera’s commitment is to simplify global trade for SMEs and uplift them with the power of networks. [Combining that with] ANEXT Bank’s digital-born identity and digital-first capabilities and services, I’m confident that we can make trade easier, more seamless and efficient for SMEs.”

Singapore’s endeavors to open up the banking industry to technology companies come closely following a comparable move in Hong Kong, where Ant and Chinese contenders including Tencent Holdings Ltd. gotten licenses in 2020.

“Continuous innovation and new capabilities that digital banks are slated to bring will no doubt add more engines of growth to Singapore’s financial sector,” MAS Chief Fintech Officer Sopnendu Mohanty said in the statement.

Ant’s payments app Alipay had around a billion annual active users as of August 2020. The company has invested in 10 digital wallet operators outside China, including Paytm in India and Dana in Indonesia.

Billionaire Jack Ma’s Ant Group soft launches its digital financial services bank in Singapore.webp