The past few years have spurred the rise of industries such as e-commerce and food delivery, exhibiting market growth in unprecedented ways. Along with its rise, we have also witnessed the growing importance of accurate mapping technology, particularly for last-mile deliveries that are reliant on correct and updated information. Thanks largely to advances in technology such as satellite imagery combined with crowd-sourced data, the overall accuracy of mapping has improved significantly, providing a visual representation of the world, which can be used for various purposes. 

Nonetheless, when maps fail to represent the real world accurately, it can lead to costly mistakes or even dangerous situations. “Maps, which are supposed to offer a reliable source of information, often misrepresent the world due to distortions or outdated data. Traditional mapping providers face challenges with unmapped regions, missing or inaccurate addressing, inadequate or incorrect points of interest (POI) data, and keeping up with changes in real-time”, shared Xander van der Heijden, CEO of UNL.

Because of these challenges, industries that require accurate mapping for efficient last-mile deliveries have been deeply affected. Hence, it is essential to find solutions to enhance mapping technologies and their applications.

How Bringing Your Own Data (BYOD) can enrich business mapping

Bringing Your Own Data (BYOD) is a powerful approach for companies looking to gain a competitive edge in the current landscape. By leveraging their unique datasets, businesses can unlock valuable insights and create customised solutions tailored to their customers’ specific needs. In this regard, location-based service companies are particularly well positioned to benefit from BYOD as they possess large amounts of location data that could be used more effectively than it currently is. This data includes address information, points of interest (POI) with associated metadata, and details about drivers and workforce insights which can be infused into the business map and provide an additional level of precision and hyperlocal location intelligence, which traditional solutions lack.

There is a plethora of valuable information that can be harnessed and maximised from driver knowledge. For example, companies that use e-vehicles for their last-mile operations can incorporate data on the vehicles’ battery capacity and the location of nearby charging stations. This data can be integrated into the routing optimization to plan the most efficient delivery routes, ensuring that the e-vehicles recharge at the most optimal stations and complete their deliveries on time. This enables businesses to increase the efficiency of their delivery fleet, reduce range anxiety and delivery delays, and improve their overall delivery performance. Particularly with last-mile deliveries, customer insights can help drivers locate their entry points for efficient drop-off.

Also read: Check out 6 startups that are frontrunners for this year’s TOP100

When incorporating their data into maps and powering location services with it, location-based businesses can greatly improve business performance by optimising delivery times/ETAs or providing better customer experiences through improved navigation capabilities. Additionally, having access to private business context allows organisations an unprecedented level of control over how they manage and maintain the quality of the data, giving them an advantage over competitors.

“BYOD, including workforce knowledge and user contributions, brings a unique, competitive advantage and is often not available via traditional mapping providers and data providers. Businesses usually have the richest and most up-to-date data. The capability to embed this intelligence to optimise services like search, geocoding, route planning, and turn-by-turn navigation, can greatly bolster performance and operations”, explained Xander van der Heijden, CEO of UNL.

How UNL empowers businesses to harness the power of their location data

Recognising the gaps in the market, UNL developed a revolutionary solution called Virtual Private Maps (VPMs) to address the limitations and challenges of traditional mapping services. The solution can be leveraged to power location services such as route planning, distance matrix, geofencing, routing, search, geocoding, etc, which are crucial features of location-based services such as food/parcel delivery, mobility, and ride-hailing, among others.

VPMs enable businesses of any size to bring, manage, and leverage their business data to power better location services. This provides businesses with greater control over their data as it remains 100% in ownership and control of the business itself. 

In addition, UNL’s VPM system allows companies to leverage third-party geospatial data sources which further enhances the accuracy of location information available for use. This creates an accurate source of location data that can be used by all types of businesses regardless of sizes, origins, or sectors. 

How UNL uses BYOD capabilities to power their unique Living Geocoder Solution

Geocoding is a critical component of many applications, as it provides the ability to accurately locate and identify a given address or point of interest (POI). UNL Geocoding API offers powerful features which allow users to take advantage of sophisticated algorithms to identify the geo-coordinates and assigns a unique UNL geoID (unique digital and verifiable address) to a given address, POI, landmark, locality or administrative area.

UNL leverages unique VPM and BYOD capabilities to power an advanced Living Geocoder solution, which continuously learns from available VPM data – including customer private business data, and third-party data sources, and leverages real-time feedback loops.

Also read: Echelon Asia Summit is back! Get to know our PR partner

Elaborating further, Xander van der Heijden expressed, “Accurate geocodes translate to fewer failed deliveries, fewer miles per delivery, less time needed to locate addresses, lower operational costs, and improved route optimisation. Leveraging our proprietary technology, we are building a hyperlocal “living geocoder” designed for continuous improvement, which can train itself with address and location data to derive higher coverage and accuracy on an ongoing basis. With our VPM approach and close collaboration with the customer, we are creating a unique feedback loop mechanism to consistently improve geocoding accuracy across regions.”

This ensures that the results are always up to date even when queries are incomplete, partly incorrect, or descriptive — making it ideal for markets with varying and inconsistent addressing standards. Furthermore, this approach also eliminates manual maintenance costs associated with traditional geolocation databases which need regular updates due to changes in addressing systems over time.

Xander van der Heijden added, “Companies across Southeast Asia are already using our technology and training their Living Geocoders with their own business data, leading to improvements in the accuracy of geocoding by 15-20%.”

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Photo by Norma Mortenson via Pexels

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This article is produced by the e27 team, sponsored by UNL

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This Means Business series showcases startups in Southeast Asia (SEA) and how they are making their money. If you want to be featured in this series, please contact writers@e27.co.

In April, Funding Societies–the digital finance platform known in Indonesia as Modalku–announced that it had crossed US$3 billion (approx. S$4.1 billion) over more than five million business financing transactions to small and medium-sized enterprises (SMEs) across the region.

This milestone encouraged e27 to reach out to the company to learn more about how it is making its revenue and building a strong and sustainable business in the fintech sector.

“Our revenue model consists of payment fees, lending and service fees, as well as interest income from SMEs and funders. As our name Funding Societies suggests, funding is a main part of our business and revenue, because it is the biggest pain point for SMEs. We hope to uplift SEA societies by giving every SME a fair opportunity for growth and by accumulating the wealth of funders,” explains Funding Societies | Modalku Co-founder and Group CEO Kelvin Teo in an email interview.

“Nevertheless, since 2019, we have explored SaaS and payments through organic buildout of supply chain finance platform Silk Road; investment into GoGMGo, Paper.id and Bank Index; and acquisition of CardUp, as well as various partnerships, to complement lending. We aim to help SMEs manage their cash flow end-to-end.”

In this conversation, Teo explains more about this business model and the lessons learned from the discovery process they had to go through to build it. The following is an edited excerpt of the interview.

Also Read: What is co-lending and how will NBFCs benefit from it?

Can you explain how you came up with the existing business model and the process you must go through?

We started as a peer-to-business lending platform in 2015. However, soon we realised that it is an excellent model to start, but not a good one to end. Hence, we have consistently evolved our business model.

We learnt that the name of the game in SEA is aggregation. This is because distribution here is nascent, hence we offer all forms of short-term financing to SMEs through our channels. This increases LTV (loan to value) and reduces CAC (customer acquisition cost).

Secondly, fintech is a risk management business – diversify. We diversify our borrower base over five countries, industries and segment sizes; diversify our funding base to include on- and off-balance sheet lending, individual and institutional funders, local and foreign funders; and finally multiply licences in each country.

This helped us to ride through COVID-19 lockdowns, market slowdown and domestic country risk.

Our approach prioritises external risk management and business nimbleness but increases internal operations complexity. Thus we’ve built up internal capabilities, streamlined products and automated processes for years.

Also Read: How will generative AI advance embedded lending

Who are your users and what is your strategy to acquire them?

We have two groups of users. Firstly, they’re under-served MSMEs from sole proprietors to small listed companies and traditional SMEs to startups, in our five operating countries across sectors. They typically come to us for their first-time business loan, top-up to a bank loan, fast credit approval and flexible financing options.

With our integration of CardUp and the soon launch of accounts, we would also help SMEs save time by automating payments, improving receivables collections and earning points by allowing card usage in more places.

Secondly, we serve individuals and institutions looking for fixed-income investments, in the form of private SME debt. They include retail and accredited individual investors, as well as banks, credit funds and impact funds that want quality, short-term, convenient and fixed-return investment.

We take an omnichannel approach towards reaching our users, i.e. digital channels, partnerships, referrals and sales, progressively moving them from offline to online.

Your company is now operating in different markets in Southeast Asia. What uniqueness does each market have? How do they contribute to sustaining your business?

Currently, we operate in Singapore, Indonesia, Malaysia, Thailand and Vietnam. Each country is unique. While we can leverage best practices, technology and talents from the group, we have to localise ~40 per cent of our business for each market.

Singapore (which we entered in 2015) is more mature in our business model evolution, Indonesia (2016) has a much larger market and Malaysia (2017) is our most stable business. Vietnam (2021) is a tough but promising market, while Thailand (2021) is up-and-upcoming.

Having a regional footprint diversifies our business from facing risks instead of only operating in one country. Our regional presence gives us economies of scale and allows us to be more productive in serving a multi-country customer base – in turn, more growth opportunities to be sustainable. Each country is a Center of Excellence for instance, we launched our first card in Singapore, Shariah-compliant trade finance and digital finance in Malaysia, and supply chain finance in Indonesia.

Also Read: How embedded lending will drive healthy growth in credit in Indonesia

There has been greater pressure for startups today to become more sustainable businesses financially. How do you achieve this with your business model?

Since 2019, we’ve had a dual focus on growth and profitability. This is demonstrated in three ways. Firstly, since inception, we’ve focused on building a credit-led business model because of its shorter path to profitability, yet longer time to build out.

Secondly, we track our product unit economics and line items in our cost-to-income ratio closely with intellectual integrity, to ensure that every loan is profitable on the first transaction and we are making meaningful steps towards group profitability.

Hence we often avoid unhealthy price wars, when others under-price the risk and cost of SMEs.

Finally, we’ve taken a conservative approach towards fundraising and capital allocation. After our first and only right-sizing in COVID-19, we’ve controlled our recruiting carefully to ensure we do not hire ahead of the business. We stay disciplined with growth experiments. And we fundraise before we need to minimise undue stress.

How do you deal with back-to-back global crises?

In the recent global crisis of credit crunch, rate hikes and continued supply chain disruption, we expect banks to cut back on SME lending, SME loan demand to stay high allowing us to cherry-pick, NPL (non-performing loans) to climb but manageable for solid firms like us, funding cost to rise yet volume to fall, equity investors to be selective, talent competition to drop giving us upgrade opportunity, and fintech market to consolidate. Overall, we’d continue growing, as the SME financing business is counter-cyclical.

The back-to-back global crises are transformative events. Most of us have not seen a pandemic like COVID-19 in our lifetime and such high US central bank rates since 2007.

Nevertheless, in my chat with my co-founder Reynold Wijaya, we realised that we have experienced some crises each year, since our founding in 2015. Yet we’ve overcome each of them.

In fact, we doubled our revenue and improved our profitability by 30 per cent last year, and grew through COVID-19 in 2020 and 2021. We attribute it to an aligned leadership, team and shareholders; Sequoia’s feedback of us when they invested in 2016 “aggressive in execution and expansion, but conservative in risk management and compliance”; our pre-emptive thinking and a dose of luck.

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

What other opportunities do you aim to seize this year? 

I’d be sceptical if a fintech firm could commit to a big plan for 2023. In fact, an investor suggested that we run on a quarterly rather than annual budget, given market volatility.

We’re strategically expanding beyond lending, through our CardUp acquisition and integration since Q4-2022, progressively across our countries. This is building on our Elevate card introduced in Q1-2022, our business expense solution with a credit line, which benefited nearly 2,000 SMEs in Singapore in just one year. We’d also be combining and scaling up CardUp’s solution to allow SMEs to make card payments in places that typically do not accept cards and facilitate collections from their customers.

For our financing business, we’re further strengthening core functions for profitable growth, team learning and development, and organisational capabilities required for an eventual public listing. In reality, we find ourselves working even harder than before.

—

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: Funding Societies

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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.

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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.

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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

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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.