Since the turn of the past decade, smaller lenders have taken the credit industry by storm – making giant, liquidity-filled strides all over the world.

These are essentially small banks and non-banking financial companies (NBFCs), that have capitalised on the limitless potential of technology to offer credit to sectors like agriculture, education and Small and Medium Enterprises (SMEs), where large banks haven’t managed to penetrate that well.

At the same time, umpteen NBFCs haven’t managed to gather a lot of capital to fund their credit offerings to modern customers. To bridge this gap, co-lending has come to the rescue.

Co-lending: What is it?

In essence an arrangement between cash-rich banks and non-deposit holding financial institutions (NBFCs) and housing finance companies (HFCs), co-lending has become extremely popular among many players in the market.

While the NBFCs would do the grunt work of loan origination and paperwork, banks would offer their liquidity strength to finance a majority of the loan. In co-lending, both parties share the risks and rewards throughout the loan lifecycle.

NBFCs have always benefited from their ability to pierce smaller, harder-to-reach geographical areas through the use of modern loan origination software and banking practices. This led to excellent growth rates, but with limited liquidity, there is only so far that NBFCs can get ahead in the market. Banks, on the other hand, have a bigger clientele, bigger wads of cash and bigger fee structures.

Co-lending is a give-and-take model by which NBFCs can improve their liquidity, profitability and client base, while banks can advantage of the market outreach, loan origination and servicing acumen of NBFCs.

How does a co-lending agreement work?

NBFCs and banks are obliged to enter a tripartite agreement with customers and play the co-lending game. The process is fairly simple but has to be executed to the T to ensure a streamlined arrangement.

Here are the three steps:

• First the NBFC performs loan origination activities through co-lending software and checks on the prospective client, after which it recommends him/her to the partner bank with the relevant documentation.
• The bank independently does requirement analysis and risk assessment of the client and vets him/her if found creditworthy.
• The lending parties enter into a three-way agreement with the client. The bank and NBFC pool their funds into an escrow account from which the loan shall be disbursed. Although both lenders will maintain the client’s accounts, they must share information and collaborate to generate a unified statement of accounts for the borrower for easier repayments.

Also Read: How will generative AI advance embedded lending

Features of the co-lending model

Ever since the Reserve Bank of India (RBI) announced the co-lending financial model, banks and NBFCs have embraced the ‘co-origination’ process that entails a bevvy of features targeted at mutually profiting both parties:

• Banks and NBFCs will usually take on an 80 per cent-20 per cent exposure limit in offering the loan to clients, with NBFCs mandated to maintain at least 20 per cent of the funding throughout the loan term.
• The portion of the loan given out by the NBFC cannot be funded by a partner bank. Loan provisioning will be done independently by the NBFC and the bank.
• Both parties’ funds must be collected and allocated in their agreed ratio at the time of funding and at the time of repayment collections, in such a way that neither party uses the funds that belong to the other.
• Both parties can charge their own interest rates, and the customer must pay the ‘blended’ interest rate.
• Loan origination will be done by the NBFC, with a risk assessment done by both NBFC and the partner bank.
• The repayment scheme for co-lending loans will follow the NACH mandate through ‘Standing Instruction’ debits from the customer account.
• Sometimes, NBFCs can also tie up with multiple banks for a distributed capital deployment; for example, the NBFC puts a 25 per cent stake, Bank A lends 40 per cent and Bank B gives 35 per cent of the loan amount.

Blended interest rate

As per the rules laid down by the RBI, co-lending warrants that the NBFC and bank together offer a blended or a weighted-average interest rate to their customer. Here’s a simple illustration of how it works:

Say NBFC A wants to offer a co-lending, loan product of ₹100,000 (US$1,222) to Mr. Vaibhav. NBFC A has a co-lending agreement with Union B Bank. The bank is ready to shell out ₹80,000 (US$978) at an interest rate of 10 per cent per annum and NBFC A pitches in ₹20,000 (US$244) at 12 per cent per annum. The weighted average interest rate that the customer gets is derived using the below formula:

Blended rate = [(₹80,000 (US$978) x 10 per cent)+(₹20,000 (US$244) x 12 per cent)]/(₹80,000 (US$978) + ₹20,000 (US$244)) = 10.40 per cent.

Repayment schedule

There are three types of repayment schedules created at the time of loan agreement – one each for the NBFC, the bank and the customer. Using the above example, let’s explore how this works:

• The NBFC’s interest rate is 12 per cent and will levy a monthly EMI of ₹1,777 (US$21) every month for one year, with a total accumulated interest amount of ₹1,324 (US$16).
• Union B Bank will take ₹7,033 (US$86) monthly and will gather a total interest of ₹4,399 (US$53).
• The customer instead will follow the blended interest rate of 10.4 per cent and pay a monthly EMI of ₹8,810 (US$108).

NBFCs’ role in co-lending

Using the power of technology, NBFCs have powered ahead in the lending industry even in the tiniest of geographical areas. Due to this outreach and loan management software, they can quickly and efficiently onboard hordes of customers under the co-lending approach. NBFCs have to provide a pre-agreed volume of loan originations in a set time period to the partner bank under any form of agreement.

The onus is on these NBF companies to explain to customers the difference between their own product offerings and products under the co-lending category. Document sharing, customer service and grievance redressals also form part of the responsibility checklist of NBFCs.

How NBFCs will benefit by co-lending

Albeit in its nascent stages, co-lending can make some serious breakthroughs in the credit industry. NBFCs are touted to grab most of the spoils in the process – here’s how:

• No more funding constraints for NBFCs while targeting high-net-worth individual (HNWI) clients as their exposure is limited to about one-fifth.
• The framework from the central bank is very transparent – this helps NBFCs steer clear of any regulatory pressure.
• NBFCs can watch and understand best practices of loan origination and risk assessments from large banks, and implement some of these practices through co-lending software to improve operational efficiency.
• Since the NBFC and bank have to create a business continuity blueprint at the commencement of a co-lending partnership, the NBFC can offer unperturbed service to its customers.
• An opportunity for NBFCs to improve their Assets Under Management (AUM), with the backing of a big-name bank.

Also Read: Why digital lending is the future for SMEs in India

Present challenges in co-lending

Since its introduction in the market, co-lending has not gained the kind of traction expected with both NBFCs and banks. Some of these challenges are:

• Common credit approval standards
• Integration to a common IT infrastructure, which could potentially streamline many origination and disbursement processes.
• Constantly fluctuating lending policies with banks and NBFCs.
• Since co-lending is a new concept, NBFCs and banks alike could be faced with accounting challenges which can easily be tackled using co-lending software.
• Integration of credit and risk management systems (both digital and non-digital) of the two parties.
• Processing fees that banks and NBFCs charge are quite different, and this has led to many challenges in collaboration.

Since it is a very new concept, co-lending is targeted only towards the Priority Sectors. For it to gain traction, global markets need to stabilise and growth needs to start ticking up.

Digital drive in co-lending

As is the case with most NBFCs, going digital for all aspects of lending has become the norm. Some digital initiatives include automated onboarding of customers, document capture, online credit risk assessment using the customer’s credit history, EMI monitoring and regulatory compliance updates for both banks and NBFCs.

These days, time is of the essence. By incorporating a scalable IT infrastructure, co-lending partners can reduce loan origination and disbursement turnaround time from a few days to just a few minutes.

The future roadmap of co-lending

There is little doubt that co-lending will prove to become a holy grail of business for NBFCs in the coming years. Big banks like the SBI are making inroads to partner with tech-rich NBFCs to implement this concept. The rules of this game are still being formed and it remains to be seen if scenarios wherein multiple banks or NBFCs can get together in an arrangement.

In which case, what would be the credit risk requirement of each NBFC? But it’s only a matter of time before co-lending spreads its arms across mainstream sectors and becomes a success mantra for other economies.

–

Editor’s note: e27 aims to foster thought leadership by publishing views from the community. Share your opinion by submitting an article, video, podcast, or infographic

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Artificial Intelligence has made a transformational impact in many industries, especially the financial services industry. For example, banks and lending institutions use AI models to provide customised financial advice and product recommendations, in addition to proactive fraud detection.

Singapore-based finbots.ai is working with organisations such as banks and lenders to provide credit modelling solutions, and it has already won many clients across Asia. finbots.ai, backed by the likes of Accel Partners, is now in expansion mode.

e27 had a chat with finbots.ai’s Founder and CEO Sanjay Uppal, who shares insights into credit modelling and discusses its importance and use cases in the lending sector and the role of AI in the financial services sector in the coming years.

Excerpts:

How does finbots.ai’s credit modelling solution utilise artificial intelligence, and what kind of data inputs does it use to make predictions?

Our credit modelling solution creditX utilises advanced Artificial Intelligence and Ensemble Machine Learning algorithms to analyse vast amounts of data to develop credit risk scorecards, providing lenders with a faster and more efficient way of assessing credit risk.

creditX can connect to any data source using APIs and develop credit scorecards using various forms of data, including historical data, bureau data, open banking data, or alternative data such as social media and invoicing data. Thus, each of our clients can develop its own custom scorecards in a matter of hours and days instead of six-plus months taken using legacy methods and technologies.

Can you provide examples of how finbots.ai has helped financial institutions make better lending decisions through its AI-powered credit modelling solution?

Our clients span banks, non-finance companies, fintech lenders, e-commerce players, digital banks, and credit bureaus, and each has seen tremendous results with creditX.

One of our first clients, an IFC-backed B2B BNPL fintech lender in Africa with over 200,000 MSMEs on its platform, faced challenges in scaling up profitable lending to its base. creditX enabled it to rapidly build high-accuracy credit scorecards and process thousands of credit applications in a day. This helped it increase the number of applications processed daily by 10x while reducing the loss rates by 5 to 10 per cent.

Another client, a digital bank in APAC, saw its loss rates decline by 50 per cent with minimal impact on loan approvals and revenues, thereby enabling it for faster profitable growth in its lending businesses.

What sets finbots.ai apart from other predictive AI startups in the financial industry, and what competitive advantages does it bring to the table?

In the predictive AI space, most solutions are in the form of AI toolkits that have high skill dependency on data scientists, data modellers, analytics specialists and domain experts for the development of high-quality models. The complexity, skill dependency, and required vendor support results in significant time requirement and an overall high cost of ownership. Additionally, organisations often have to expose their confidential data to get the desired models.

Also Read: How Transparently.AI uses Artificial Intelligence to detect accounting manipulation, fraud

finbots.ai has built a vertical AI product creditX which pioneers predictive AI for the credit modelling use case, taking into account all regulatory, data privacy, security and risk management challenges the industry faces.

In comparison, building a model that takes weeks with an AI toolkit takes less than an hour on creditX.

Today, only the largest 5 to 10 per cent of lenders can afford sophisticated credit modelling solutions. We are democratising credit modelling, making creditX affordable for even the smallest lender, with a pricing model that scales as a lender grows. Hence, our clients range from small start-up lenders to mid-to-large-sized banks.

Our credit modelling solution, creditX, allows organisations to perform a rapid Proof-of-Concept (PoC).

How does finbots.ai ensure the accuracy and reliability of its credit modelling algorithms, and how often are they updated?

We have a rigorous process to ensure the accuracy and reliability of our credit modelling algorithms, including extensive testing and quality control measures for a variety of scenarios. We are also constantly evolving our models to incorporate new advances in Data Science.

In fact, finbots.ai is amongst the first companies to complete ‘AI Verify’ – the world’s first AI governance testing framework and toolkit developed by Singapore’s Infocomm Media Development Authority (IMDA) and the Personal Data Protection Commission (PDPC).

The AI Verify framework enables companies to objectively validate the performance of their AI systems, ensuring that they are fair, explainable, and responsible.

What are some of the biggest challenges that you face when working with financial institutions, and how does the company address them?

For financial institutions, the process to develop and deploy a credit model has evolved little over the past three decades and takes six to 12 months. Only a small fraction of lenders today have access to and affordability of the technology and skills required to develop sophisticated credit scorecards.

creditX delivers higher quality credit scorecards with the entire process completed in hours. This requires a significant paradigm shift in credit management and transforms parts of the credit risk management process.

To facilitate this shift, we offer clients access to sandbox environments to test our solution and bring their own data for Proof of Concept (PoC) testing, which can be completed in 3 to 5 days. After all, seeing is believing.

How has finbots’s client base evolved since its inception, and what are its plans for expanding its reach in the future?

We launched version 1.0 of creditX in early 2020, with our first client deployment in Dubai. Soon after that, COVID-19 hit, and we focused our energies to accelerate product development. Our current version was originally envisioned for Q4 2024.

Since completing our Series A funding round in April 2022, we have expanded our client base to institutions across Asia, Africa, the Middle East, and most recently Australia. Our clients span the full breadth of lending organisations from banks, fintech lenders, mortgage lenders, credit bureaus, e-commerce lenders, loan marketplaces, SME lenders, and agri finance lenders.

We continue to deepen our market presence in Asia Pacific, Africa, APAC, the Middle East and India throughout the year and will expand to North America later this year.

How does finbots.ai’s approach data privacy and security, especially given the sensitivity of financial data?

Credit risk is a highly complex area with demands from both regulators and boards for model development, explainability of AI, data security and data privacy.

Our leadership team brings deep global experience in financial services that we have harnessed in our product design that ensures our product meets these stringent requirements of regulators and boards.

Also Read: From human to AI: Embracing change and thriving in the new world of work

finbots.ai is ISO27001 certified and recognised as SOC2 Type 2 compliant, ensuring the highest levels of data security & privacy in our product and operations, thereby giving our clients the required confidence.

creditX is designed to comply with regulatory standards across markets and is evidenced by our presence in 8 markets, and growing more.

How does finbotsAI see the role of AI evolving in the financial industry over the next five to ten years, and how does it plan to stay at the forefront of these developments?

AI will have a transformational impact on financial services across areas of services, customer service, process efficiencies and risk management.

The approach we have taken towards AI is to build solutions that enable rapid time-to-value for clients, and this remains core today.

We have a well-defined roadmap over the next five years, including launching other products that transform areas of financial services that have remained relatively unchanged for the past 30 years.

The company has clients across India, Dubai, Singapore, Australia and Mongolia.

We also have a growing client presence in Southeast Asia and Africa. In addition to these regions, we have also tested the suitability of our product in North America, South America and Europe. We have plans to expand to these markets later in the year.

We believe our AI-powered credit modelling solution can help financial institutions across the globe, and we are committed to bringing it to as many markets as possible to drive financial inclusion and help lenders mitigate risk.

—

Echelon Asia Summit 2023 is bringing together APAC’s leading startups, corporates, policymakers, industry leaders, and investors to Singapore this June 14-15. Learn more and get tickets here.

Echelon also features the TOP100 stage, where startups get the chance to pitch to 5000+ delegates, among other benefits like a chance to connect with investors, visibility through e27 platform, and other prizes. Join TOP100 here.

The post AI will transform customer service, risk management in financial services: finbots.ai CEO appeared first on e27.

Picture this: Indonesia pre-pandemic. The financial services industry remains largely centred around banks while alternative digital services offered by tech firms such as mobile wallets or P2P (peer-to-peer) lending are still developing.

According to Google, Temasek, and Bain & Company’s joint study in 2019, there were around 92 million unbanked and 47 million underbanked adults in the country. In the following year, cash also still accounted for 77 per cent of POS (point of sale) purchases as well. 

However, things have changed drastically since then. Post-pandemic, Indonesia’s financial sector has since undergone an unprecedented digital transformation.

A 2022 report by Google, Temasek, and Bain & Company revealed that the country’s digital economy has grown from US$41 billion in 2019 to US$77 billion in 2022 and is expected to surge further to around US$130 billion by 2025.

The digital financial services industry has experienced similar growth during this time, and I foresee digital payments, investment, remittance, and lending continuing to maintain this growth momentum.

The driver behind digital transformation 

Being actively involved in Indonesia’s growing fintech industry both before and during the pandemic, I have observed that the increasing prominence of the API (application programming interface) economy is driving the rapid digital transformation of Indonesia’s financial services sector.

Through the widespread use of APIs via the open banking system, it’s easier now for organisations to share their digital services, assets, and data with external parties to facilitate secure, seamless integration across platforms.

As a result, both financial and non-financial institutions in Indonesia have been able to collaborate and offer a wider range of digital services more efficiently and at lower costs. This revolution is expected to catalyse financial inclusion across Indonesia (particularly in remote areas).

Also Read: In Indonesia, the problem is lack of insurance accessibility, not affordability: Qoala CEO

Looking back, how has the API economy successfully driven the digital transformation of Indonesia’s financial services sector throughout the pandemic? From my perspective, there are three critical factors at play: 

Strong backing by regulatory bodies

Indonesia’s regulatory bodies, Bank Indonesia (BI) and the Financial Services Authority (OJK) have been promoting open banking and standardising Open APIs for years, but in my view, their efforts to digitise financial and payment systems have intensified during the pandemic. One key initiative is the QRIS payment system, which now has over 22 million registered users and has streamlined payment processes for micro, small, and medium-sized enterprises (MSMEs).

In 2021, BI also launched BI-FAST, a real-time and cost-effective payment system, and introduced a legal framework for APIs through SNAP. Meanwhile, OJK has increased its efforts in monitoring the fintech industry, constantly updating information on licensed P2P digital lending institutions on its website for public awareness.

OJK is also committed to resuming executing its “Indonesian Financial Services Sector Master Plan 2021-2025,” with open banking being a top priority. This involves fostering innovation and driving digital transformation in the financial sector through various measures, as outlined in the master plan. Indeed, I am looking forward to the impact that these efforts will have on Indonesia’s financial landscape in the future.

Increased collaboration for innovation and growth

With the regulatory bodies driving open banking and digitalisation in the financial industry, traditional financial institutions such as banks, are collaborating positively with non-traditional institutions like e-commerce and digital lending providers.

These partnerships have resulted in the emergence of numerous alternative digital financial services, providing new value propositions that weren’t previously available before. As the popularity of these services continues to rise in demand amongst Indonesian consumers, I see an ongoing need to develop more API solutions to meet this demand.

Some popular examples are lending startups supported by traditional banks that offer digital micro-loans for MSMEs and e-commerce platforms that provide buy-now-pay-later (BNPL) options.

Also Read: MeetUp with Indonesia’s most exciting tech entrepreneurs!

Alternatively, banking apps now also integrate digital wallet features, offering customers more convenience and flexibility. The P2P lending sector has also experienced remarkable growth, with a 95 per cent year-over-year increase in loan disbursements in December 2021, enabling easier access to alternative individual lending.

In my assessment, the increasing penetration of tech firms in the financial sector has led to a higher willingness among customers to explore novel offerings from these players. This trend is backed by the findings of EY’s “NextWave Global Consumer Banking Survey,” which indicates that 91 per cent of respondents from Indonesia “completely or mostly trust their primary financial relationships.” 

This figure is notably higher than the global average of 82 per cent. As the market continues to seek out innovation, ease of use, and greater inclusivity, I anticipate that the demand for API-driven solutions will persist.

Access to more consumer segments

With the emergence of alternative financial services, made possible by API, some financial institutions can target more niche market segments, such as those with specific business sizes and needs, with lending for MSMEs as an example.

Other companies are honing in on particular market segments, like agritech firms offering fintech solutions for key players in domestic agriculture or insurtechs providing smaller to micro retail insurance plans. 

The presence of API has allowed businesses to offer these customised financial services without having to build them from scratch and make them available in a timely manner. On the other hand, among the niche market segments that rely on traditional financial services, the pandemic has accelerated the adoption of digitised financial services.  

Having been in Indonesia’s fintech startup scene since the early 2010s, I have witnessed firsthand the country’s rapid digital transformation. What began as simple online marketplaces has evolved into super-apps that have become integral to people’s daily lives, providing not only e-commerce services but also a wide range of financial services such as bill payments or insurance purchases. 

This transformation has been made possible by APIs, and I believe it is only the beginning of the API economy in Indonesia. As challenges are overcome, the API economy will continue to grow at an unprecedented pace, eventually reaching every corner of the nation.

–

Editor’s note: e27 aims to foster thought leadership by publishing views from the community. Share your opinion by submitting an article, video, podcast, or infographic

Join our e27 Telegram group, FB community, or like the e27 Facebook page

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Siam Cement Group (SCG) today announced that it had acquired Indonesian home service marketplace Seekmi for an undisclosed sum.

Following the acquisition, Seekmi will continue to use its brand while Founder and CEO Clarissa Leung will have the role of Advisor.

In a press statement, SCG said that with the acquisition, its subsidiary Q-Chang, can immediately gain a foothold in the service industry in the market with nearly 300 million people and one of the fastest-growing middle-class populations in the world.

SCG has been eyeing to expand its Q-Chang business into Indonesia in recent years after experiencing rapid adoption of its platform in Thailand.

According to the group, the Bangkok-based subsidiary has become one of the fastest-growing home service platforms in the country, since its founding in 2018. They offer similar services to Seekmi and share many of the same core values, such as providing consumers with high-quality, affordable home services that can be ordered on-demand through an app or website.

Also Read: News Roundup: Seekmi partners Tokopedia, Lazada to launch on-demand disinfectant service

Founded in 2015, Seekmi was known as the first home service marketplace in Indonesia and has grown to over eight cities in Indonesia with tens of thousands of service providers and hundreds of thousands of household customers.

The company is most well-known for its HVAC, handyman, electrical, cleaning, and laundry services for the home. In 2018, it expanded through its partnerships with top global brands such as IKEA, Samsung, Coca-Cola, Panasonic, Daikin, Toshiba, and JYSK to offer installation, assembly, repair, maintenance, and even delivery services to their respective customers.

SCG was first established in 1913 following a royal decree by His Majesty King Rama VI to produce cement and has since grown into one of the largest conglomerates in Southeast Asia and the second largest in Thailand.

It is majority owned by King Vajiralongkorn of Thailand and has been hugely successful in growing its cement, building materials, chemical, construction, packaging, solar, and logistics businesses globally. The company is consistently ranked as Thailand’s top graduate employer and has over 54,000 employees.

e27 has reached out to Seekmi to find out more details about their post-acquisition plans.

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Echelon Asia Summit 2023 is bringing together APAC’s leading startups, corporates, policymakers, industry leaders, and investors to Singapore this June 14-15. Learn more and get tickets here.

Echelon also features the TOP100 stage, where startups get the chance to pitch to 5000+ delegates, among other benefits like a chance to connect with investors, visibility through e27 platform, and other prizes. Join TOP100 here.

Image Credit: Seekmi, SCG

The post Siam Cement Group acquires Seekmi to expand its subsidiary’s business to Indonesia appeared first on e27.

Collaboration between startups in different countries can be a game-changer for the growth and success of these companies. In this regard, the partnership between startups in New Zealand and Singapore is worth noting due to the similarities between the two markets.

In an interview with e27, New Zealand Trade Commissioner Maggie Christie reveals the similarities between tech startup communities in the two countries, starting from their geographical characteristic and market size.

“Because both Singapore and New Zealand have the need to export. We need to export to grow, and there’s a lot of government support for Singapore and New Zealand companies,” she explains.

The New Zealand Trade and Enterprise (NZTE) has been instrumental in helping grow New Zealand businesses getting into Singapore and Southeast Asia. The organisation’s primary role is to help New Zealand companies understand the Singapore market better and connect them with potential partners. It has been working closely with Enterprise Singapore to facilitate the expansion of Singaporean companies into New Zealand, particularly in the tech industry.

For New Zealand startups, popular sectors include foodtech, cleantech, and health tech–and there are already several collaborations between startups in these sectors with Singapore.

Also Read: French accelerator ZEBOX opens APAC hub in Singapore

One of the existing collaborations between startups in New Zealand and Singapore is the MOU signed between Foodbowl – SIT– Food and Plant Ltd. It was forged to allow multi-project cooperation between the parties to accelerate Singapore and/or New Zealand business enterprise outcomes within specific food innovation and manufacturing areas.

There are also other New Zealand companies that collaborate with businesses and organisations in Singapore in various sectors. For example, medical software The Clinician partners with SingHealth to improve communication between the doctor and patient.

In the greentech sector, Cogo allows banks to provide customers with carbon tracking associated with their spending, raising awareness and helping people to reduce their carbon footprint.

Then there is also Xero, the cloud-based accounting software.

“Our tech ecosystem is very tight, much smaller than Singapore. We are spread out throughout the country, but about fifty per cent of that is focused in Auckland, our largest city,” Christie says.

“The ingenuity that gets started by one company or one entrepreneur then starts getting connected within that broader ecosystem. So, there’s a lot of sharing and collaboration. And I do see that in Singapore as well. I think the slight difference is that in New Zealand, it is generally Kiwis working together, whereas, in Singapore, you tend to get lots of different nationalities working together.”

Also Read: Going solo: Legal considerations for starting a small business in Singapore

Beyond technologies

The partnership between Singapore and New Zealand is not limited to the tech industry. They have also been working together to create sustainable initiatives, such as green lanes for flights powered by sustainable fuels between the two countries and a platform for offsetting carbon emissions. The focus is on creating something to help each other and the world.

This can be seen in the statistics itself:

• New Zealand is Singapore’s closest/most important strategic economic partner, largest trading partner in Southeast Asia, and 4th largest trading partner globally.
• The two countries saw a total of NZ$10,407 million in two-way trade in the year ended December 2022, contributing to their 4th place in two-way trade rank.

In the future, the areas of health and wellness, creative services, and edutech are identified as potential areas for growth in Singapore.

Networking and promoting events in a post-COVID-19 world has been challenging for many organisations, including New Zealand tech companies that are looking to enter Singapore. This stresses the importance of keeping the dialogue going and showcasing new companies.

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Echelon Asia Summit 2023 is bringing together APAC’s leading startups, corporates, policymakers, industry leaders, and investors to Singapore this June 14-15. Learn more and get tickets here.

Echelon also features the TOP100 stage, where startups get the chance to pitch to 5000+ delegates, among other benefits like a chance to connect with investors, visibility through e27 platform, and other prizes. Join TOP100 here.

Image Credit: New Zealand Trade and Enterprise

The post How New Zealand and Singapore are working together to build a great future with tech appeared first on e27.

As the dreary funding winter soars, at e27, we are kickstarting a new article series Line of Hire to understand an organisation’s culture and hiring philosophies to empower tech workers with the right growth tools to enable business owners to attract talent.

Terng Shing Chen is the Founder and CEO of PR and content marketing technology startup SYNC. With over a decade of experience in public relations and content marketing, Chen combines traditional PR and content methods with automation technology to create a scalable agency.

As the CEO of SYNC, Chen oversees business strategy and expansion, as the brand continues to grow in the region. He has led the company’s expansion into four markets, Singapore, Malaysia, Indonesia and India, and set up strong partnerships in Thailand, Vietnam and The Philippines.

Chen is also the lead media and messaging trainer for SYNC, having trained over 50 leading founders, CEOs and entrepreneurs in his career. He regularly conducts training sessions for startup founders through numerous startup accelerators and venture funds.

Besides SYNC, Chen is also the Co-Founder of the travel community platform Travel Wanderlust and co-host of the business podcast Business Over Drinks.

In this episode, Chen shares his organisation’s culture and hiring philosophies.

Excerpts:

What personality traits/qualities do you look for in potential employees?

It may sound cliche, but we look for people with a couple of traits: the willingness to learn and the ability to be independent. These are critical qualities because, at SYNC, we look for people who are problem-solvers and adaptable. With technology and marketing changing at such a rapid pace, being stagnant or unwilling to learn is not a desirable quality.

How do they fit into your company culture? Tell us a little more about your company culture.

Our company culture is driven by communication. We encourage over-communication in fact, where we have team members keep everyone updated on progress on a very regular basis. This might sound a bit of an overkill, but it actually helps foster team bonding and enhance clear visibility of activity, which is necessary for our remote team.

At SYNC, we firmly believe that over-communication is a crucial factor in building strong and cohesive teams. To achieve this, we have implemented various strategies, such as daily check-ins, weekly progress reports, and team meetings that are a mix of messaging, video calls and in-person to develop some form of familiarity with each other.

We also encourage open communication channels, which are driven from the top down. This means I need to be over communicative and at the same time, I need to encourage people to speak to me and not be a stereotypical middle manager.

How do you foster transparency and encourage achievement at SYNC?

This is led by the over-communication policy we have in place, where we encourage people to share both the negatives and positives from their work. Every week a member of the team shares a detailed progress update including lessons learnt and we celebrate the individual achievements either through something as simple as a company-wide Slack message or even hosting a team dinner.

Also Read: Impactful technologies empower lives: Viveka Kalidasan of Let-Lab

Do you have a mental health policy? What does that look like?

We don’t have a detailed mental health policy, but rather we explore each instance on a case-by-case basis as everyone’s situation is different. As a team, we try to provide support and no judgment to foster honest conversations about difficult topics or situations they may be in.

In practice, this allows us to provide support where required and if necessary, provide them with time off to handle any issue. However, as we continue to scale, the ability to deal with these situations well and with compassion becomes challenging, so we are looking into more concrete processes and policies around this.

WFH or WFO, or hybrid?

WFH has been our preferred choice since day one, before the pandemic. We’ve conducted multiple in-house surveys to offer a hybrid option or a full WFO experience, but it has always been WFH for us.

How should a tech worker prepare for the funding winter?

I think the demand for high-quality talent still remains, but the companies and where the demand is coming from are evolving. If you have a valuable and relevant skillset, you will be fine, but I think gone are the days of table tennis in the offices and free beers all the time.

From my experience, this is part of the overall cycle and we see the ups and downs in the economy and for industries all the time.

How do you measure the performance of your employees?

We are output driven, so each member of our team has a clear idea of what they need to produce. As the team leader, I need to provide them with the tools for them to succeed and give them the freedom to excel. Whether you are a junior member or an experienced team leader, everyone needs to have a clear set of outcomes.

Also Read: Keep learning and building relationships during funding winter: Richard Yan of Airwallex

Will you consider a moderately skilled person with great honesty or a highly skilled person with less honesty when hiring?

I go for the former because honesty is a critical part of running a successful distributed team. We have a lot of people involved at any stage of a project and those that are willing to learn, improve as we move along and admit their mistakes and gaps in knowledge are important.

I’ve learned over time that everyone makes mistakes regardless of skill, experience or position in the company, being honest about it, ensures we can rectify the mistake and stop it from spiralling out of control. This is essential for a company like ours.

Do you encourage ‘intrapreneurship’ at SYNC?

Yes, we absolutely do with each member of the team being encouraged to learn how the business runs, and the processes behind it and get involved (to some extent) with other aspects of the overall business. If your team member understands why we do what we do and how everything works, it is easier for them to buy into our vision and mission of the brand.

How do you support upskilling for your employees?

We have a few programmes in place, some include bringing external or using internal trainers to run workshops, as well as giving certain employees the opportunity to take courses to improve their skills. It depends on what they need and the path they want to take within the company, but in all honesty, we have seen a lot of positive growth within the team from our current efforts that we plan to continue this for as long as possible.

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Echelon Asia Summit 2023 brings together APAC’s leading startups, corporates, policymakers, industry leaders, and investors to Singapore this June 14-15. Learn more and get tickets here. Echelon also features the TOP100 stage, where startups can pitch to 5000+ delegates, among other benefits like connecting with investors, visibility through the platform, and other prizes. Join TOP100 here.

The post Our company culture is driven by communication: Terng Shing Chen of SYNC appeared first on e27.

Sumitomo Mitsui Banking Corporation (SMBC Group) today announced that it has co-founded the corporate venture capital fund “SMBC Asia Rising Fund” with Incubate Fund in Singapore. The fund managed is US$200 million, and its purpose is to accelerate business development and partnerships through investments in high-potential Asian startups.

Through this CVC, SMBC Group will enhance its business and provide clients with new solutions by uncovering/applying new technologies via partnerships with investee firms and developing new business models/products.

They will also enhance the value of its investee financial institutions in Asia by collaborating with startups looking to invest in areas such as lending tech, payment, supply chain finance, Banking-as-a-Service, and digital assets.

Also Read: Japan’s online language learning site Best Teacher raises US$530K from GMO VP and SMBC VC

This strategic partnership between SMBC Group and Incubate Fund will allow them to capitalise on opportunities in emerging markets while contributing to the growth of SMBC Group’s businesses through access to innovation and new technologies that can drive long-term value creation across industries.

e27 has reached out to the organisations to find out more details about their investment strategies and plan.

Incubate Fund is a leading Japanese venture capital firm specialising in early-stage startups. Since its establishment in 2010, the firm said that it had invested more than JPY98.3 billion (US$728 million) in more than 450 startups. The new CVC will be managed by Incubate Fund’s Singapore office.

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Echelon Asia Summit 2023 is bringing together APAC’s leading startups, corporates, policymakers, industry leaders, and investors to Singapore this June 14-15. Learn more and get tickets here.

Echelon also features the TOP100 stage, where startups get the chance to pitch to 5000+ delegates, among other benefits like a chance to connect with investors, visibility through e27 platform, and other prizes. Join TOP100 here.

Image Credit: Louie Martinez on Unsplash

The post SMBC, Incubate Fund launch new US$200M fund for Asian startups in fintech space appeared first on e27.

Stripe, a financial infrastructure platform for businesses, today announced a partnership with WhatsApp that allows Singapore businesses to accept payments directly in WhatsApp chats.

The new feature is built on Stripe Connect and Stripe Checkout, and enables Singapore customers and businesses to buy and sell directly in WhatsApp without having to go to a website, open another app, or pay in person.

The option to enable payments on WhatsApp in Singapore is available to local businesses using the WhatsApp Business Platform, which will include a Stripe account. The feature is currently available to a small number of Singapore-based businesses and will be available to many more in the coming months.

Supported payment methods include credit and debit cards, and PayNow, a real-time payment system popular in Singapore.

Also Read: AWST launches with US$1.7M in funding, teams up with Stripe

Singapore businesses that accept payments with WhatsApp chat also gain access to the Stripe Dashboard, a tool for managing all of their Stripe data in one place.

“Starting today, people in Singapore can pay their local merchants on WhatsApp in just a few taps,” said Stephane Kasriel, head of fintech at Meta, the company behind Whatsapp.

Since it launched in 2010, Stripe has featured more than 100 optimisations that enhance every aspect of the checkout experience, including pre-built payment UIs and more than 40 payment methods.

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Echelon Asia Summit 2023 is bringing together APAC’s leading startups, corporates, policymakers, industry leaders, and investors to Singapore this June 14-15. Learn more and get tickets here.

Echelon also features the TOP100 stage, where startups get the chance to pitch to 5000+ delegates, among other benefits like a chance to connect with investors, visibility through e27 platform, and other prizes. Join TOP100 here.

Image Credit: Stripe

The post Stripe, WhatsApp introduce new feature to help businesses accept payments in chats appeared first on e27.

Quest Ventures’s Partner launches new VC firm MSW Ventures
MSW Ventures, launched by Jeffrey Seah, first fund Asia Fund X seeks to invest in foodtech, agritech, data tech, sustainability, and enterprise tech.

Sumitomo’s SMBC launches US$200M corporate VC fund in Singapore
SMBC Asia Rising Fund targets startups that contribute to SMBC Group’s business through collaborations or business development in areas such as lending tech, payment, supply chain finance, banking-as-a-service and digital assets.

SG’s Allrites goes public in the US through Aura Fat merger
A statement said the transaction will give Allrites an enterprise value of US$92M; The merger will see Allrites becoming a wholly-owned subsidiary of Aura FAT Projects and listed on the Nasdaq under the ticker “ART”.

Indonesian e-grocery firm Tumbasin shuts down, to file for bankruptcy
This comes after the company suffered from “insurmountable financial challenges”; Founded in 2017, Tumbasin enabled users to compare prices of groceries across traditional markets and make purchases directly through the platform.

Jollibee billionaires launch online stock trading platform DragonFi
With the ability to create personalised layouts and multi-monitor support, DragonFi offers advanced charts with over 100 studies, indicators, and drawing tools available on its web and mobile app.

Ant Group eyes selling stake in HK digital bank subsidiary
Ant Bank, which has received approval from the Hong Kong Monetary Authority, is reportedly in talks with potential investors to strengthen its operations; The sales plan, however, is still in its early stages.

Elon Musk teases free Tesla FSD trial in North America
The Tesla CEO has laid out a rough plan for expanding access to Full Self-Driving (FSD), the company’s advanced driver assistance system, throughout North America and the rest of the world.

Binance resumes Bitcoin withdrawals after two halts in a day
Binance had paused withdrawals earlier as it didn’t anticipate the recent surge in Bitcoin’s network gas fees; On Monday, the average fee per Bitcoin transaction rose to US$7.25, the highest since May 2021.

Indonesian online kitchen startup Uena raises funding
The lead investors are East Ventures and Trihill Capital; Uena will use the fresh funds to expand its operations in Jakarta as the company looks to cater to a larger user base.

UOB leads US$51.5M round of Vietnam’s Buymed
Buymed operates a B2B e-commerce website that connects pharmaceutical manufacturers, distributors, and clinics; Buymed (known as Thuocsi in Vietnam) recently raised US$51.5M from major regional investors.

Take a look at the news articles we published this week
Advance Intelligence Group’s US$80M raise and Integra Partners’s Fund II close were the major news of the week.

Bootstrapped: How dating app Sirf Coffee takes on the likes of Tinder without raising VC money
The early challenges for Sirf Coffee were buying behaviour, lack of dating exposure, credibility, and membership pricing.

How startups are using Hong Kong as the launchpad of their international expansion
On the sidelines of the 7th Elevator Pitch Competition (EPiC) by the HKSTP in late April, e27 had an opportunity to speak to several startups that participated in their programme.

These 15 startups might just be part of this year’s TOP100
From our diverse pool of applicants, get to know these 15 startups that are close to competing at this year’s competition.

MeetUp with Indonesia’s most exciting tech entrepreneurs!
The Indonesia stop of e27’s regional meetups is happening tomorrow, 9 May 2023. Here’s why you should be there.

Journeying through the long, winding road of startup investments and M&A in 2023
In addition to investments flowing into particular sectors, we can also expect to see more M&As happening in the region in 2023.

Why the education sector needs a lesson in ad fraud
Education marketers need to be fully aware of the digital advertising supply chain which requires more trust and transparency.

Early-stage proptech and contech investing: Who gets the VC checks?
When assessing contech startups, the ability of the founding team to navigate a complex B2B sales environment is key to their survival and growth.

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Echelon Asia Summit 2023 brings together APAC’s leading startups, corporates, policymakers, industry leaders, and investors to Singapore this June 14-15. Learn more and get tickets here. Echelon also features the TOP100 stage, where startups can pitch to 5000+ delegates, among other benefits like connecting with investors, visibility through the platform, and other prizes. Join TOP100 here.

The post Ecosystem Roundup: SEA gets two startup funds, Indonesian e-grocer Tumbasin shuts down appeared first on e27.

Indonesia-based edutech startup Ruangguru today announced that it had completed an acquisition of Mclass, a live teaching edutech platform in Vietnam, for an undisclosed sum.

In a press statement, Ruangguru said the acquisition is a strategic move to expand its reach and capability in the market, following its launch in Vietnam through its subsidiary Kien Guru.

“We are thrilled to welcome Mclass to the Ruangguru family. Together with Kien Guru, we believe that Mclass’s reputation and understanding of online learning can further strengthen our offerings and business in Vietnam and Southeast Asia (SEA),” said Belva Devara, Co-Founder and CEO, Ruangguru.

Also Read: The future of edutech: Personalising learning for all

“Our vision is to become the leading edutech company in SEA, and we believe this acquisition is a step forward in reaching that goal.”

Founded in 2019 by Nguyen Van Khai and Nguyen Minh Thang, Mclass is one of the fastest-growing edutech platforms in Vietnam. It is working with top-performing teachers in the country to offer live teaching sessions in subjects such as math, science, literature, university entrance preparation, and IELTS. The platform’s live teaching sessions has gathered 85,000 participants and a total of one million replays in 2022.

e27 has reached out to Ruangguru to find out what will happen to Mclass brand following the acquisition.

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Echelon Asia Summit 2023 is bringing together APAC’s leading startups, corporates, policymakers, industry leaders, and investors to Singapore this June 14-15. Learn more and get tickets here.

Echelon also features the TOP100 stage, where startups get the chance to pitch to 5000+ delegates, among other benefits like a chance to connect with investors, visibility through e27 platform, and other prizes. Join TOP100 here.

Image Credit: Ruangguru

The post Ruangguru acquires Vietnamese live teaching platform Mclass appeared first on e27.