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Why Clik believes that Cambodia is the best place to pilot a new fintech infrastructure

(L-R) Clik co-founders Darren Jensen, Matthew Tippetts, Skye Cornell

Matthew Tippetts started his professional career as a tech banker about 20 years ago, before moving out to manage portfolios at US-based hedge fund Citadel. This enabled him to come to Asia where he soon discovered the massive gap in terms of the user experience.

“There wasn’t a lot happening in online space. There were a lot of things that could be done to help merchants and get them to really leverage data properly to grow that business. So that’s basically how the idea started,” Tippets recalls.

The first thing that Tippets and his co-founders did was to do a market study. “We wanted to understand how people do payments. So we interviewed 1,800 businesses, about a thousand people, to really understand what people are ready to do and how they do it,” Tippets says.

Tippets wanted to see what the people were using at that time and what the trust factors were out there.

This initiative eventually led to the founding of Cambodia-based fintech startup Clik.

“We wanted to see their interest in some of the services that I was envisioning at the time, and the result of the study was positive. And so we decided to start building up the team, Skye (Skye Cornell, Chief Marketing Officer) and I. We then met the third co-founder, Darren Jensen, along with other co-founders who are all either serial entrepreneurs or tech professionals, fintech professionals,” Tippets continues.

Why Cambodia

In its platform, Clik shares its vision to “create a digital community across Southeast Asia by providing a 100 per cent safe and seamless payment method, suitable for everyone” by building an advanced mobile payment system for enterprises, merchants, and consumers.

In doing so, the question arises on why Cambodia was chosen to achieve this.

“I was at the time in Cambodia, so that was a natural reason. But also it’s mostly because Cambodia, in our view, is the best place for piloting a new technology infrastructure. Here, we have close to more than 80 per cent of internet coverage for the population, where you can get 10 gigabytes for US$7-8. Ninety-five per cent of people here have smartphones, so they have the tools to do mobile payments,” Tippets elaborates.

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“When we did our feasibility studies and asked questions to people paying in Cambodia, close to 60 per cent of them were already using apps to make payments. One of the payment companies was in 30 per cent of people’s smartphones, which showcased how big the level of penetration is,” Tippets says.

In contrast to what most people believe, Cambodia has a pretty dynamic fintech sector. There are already quite a few players such as Pi Pay, a youth-targeted cashless mobile payment platform.

Phone-to-phone tapping payment

To understand the kind of ecosystem Clik is building, imagine the not-so-distant future where no hardware is required to do a cashless payment.

“We’re looking to enable banks to link bank accounts to the app, so that when you tap with your phone to make a payment, it comes straight out of your bank account, making it practical because it’s completely seamless,” Tippets announces.

Tippets adds that what can be seen now of the company is a little bit like the tip of the iceberg.

“The visible part of the platform is that we help merchants do different things related to data insight. From creating loyalty plans to microtargeting, messaging and so on, all available in the app for the consumer. But beyond that, we have web applications developed for internal purposes, such as building our own customer relationship management and sales force automation system to automate and assist the activation team in reaching out to merchants and converting them,” says Tippets.

“We’ve also built an electronic KYC product that could allow these merchants’ customers to link their bank accounts and onboard customers in 90 seconds when it comes to consumers,” Tippets adds, saying that the e-KYC is where they really hit it off when they first showed it to the target merchants.

“We decided to prioritise the e-KYC and it’s a critical part to the customer journey, whether it’s a merchant or the customers. A merchant can just download the app and look through the application to fulfil all the necessary Know-Your-Client, which is similar to what a bank would require, but in an automated way,” he continues.

Also Read: Cambodian fintech startup Clik raises US$3.7M in seed funding, announces key hirings

In Cambodia, however, to do the standard KYC, it is required to have a face-to-face check-in.

“To address this, we have an activation team queued up with this sales force automation tool, which can really make it easy for the activation team to target merchants and act on converting these merchants onto our platform. So they would go to a merchant, help them download the app, help them collect all the information they need, and within five minutes, a merchant can be fully KYC,” Tippets breaks it down.

The capability to onboard merchants in five minutes is powerful because it opens up a completely new market, which is where the micro SMEs can really thrive with the elimination of needing a Visa account or hardware tool, as everything is done via smartphone only.

The investment and partnerships preceding the launch

“We were unorthodox in terms of our late commercial launch, as we’re looking to really establish our footing in this space. But we have signed agreements with the equivalent of over 2,500 merchants, and we also have agreements with financial institutions for testing and partnering with our services,” Tippets said.

Even before it was officially launched, Clik manages to secure several investments and international partnerships. The company is also raising for its Series A.

Clik’s leading investor is Openway Group, one of the leading investors in mobile payment and cloud payment systems.

“When we explained it to the founder, Andrew Vereninov, he immediately understood what we were doing and volunteered to help us. And within a call, we got nearly US$700,000 in funding, and we’d been working with them for nearly four years now.”

The company then got another investment from Phillip Capital’s POEMS.

It is also securing a guaranteed license by the National Bank of Cambodia. “We expect to get a license by October earliest. So there’s no longer any regulatory risk before our official launch,” Tippets adds.

Also Read: MYPINPAD and Clik aim to unify the digital point-of-sale industry

In addition to the investments, Clik also utilises MYPINPAD’s enhanced Payment Card Industry (PCI) compliant payment security, as well as facilities that allow integration with existing payment infrastructures.

Being data-driven as the main focus

The recent and on-going funding will be used for a product roadmap.

“Let’s assume that we’re on track with the launch at the end of 2020, by the first half of 2021, we expect to have quite a few more payment capabilities. So we’re hoping to start with Visa, but we’ll add on MasterCard, and most likely UPI and Alipay. We’ve also already been in discussions with a few other financial institutions to be able to link up with their accounts,” Tippets details.

“We also plan on having additional functionalities launched shortly after the commercial launch, with international remittance being one of them. And in the second half of 2021, we will have further data-driven tools around data analytics and artificial intelligence and machine learning to help our customers predict their revenues and also optimise loyalty plans and the micro-campaigns,” Tippets further adds.

“On top of that, we also expect to expand by the end of the year as we’re already well in the process of applying for a patent license in a neighbouring country, which most likely will be Myanmar,” he ends.

The data-payment gap

Right now, according to Tippets, 85-90 per cent of transactions are still in cash in Cambodia, and that is with around 25 mobile payment players existing in the market.

Tippets says that the potential for market growth is huge as there is enough space for quite a few players. He specifically points out the brick-and-mortar businesses, in which there’s a massive fragmentation of payments and of data.

“In Southeast Asia, for retail payment, 97 per cent are in brick-and-mortar businesses, but nobody’s really catering to these brick and mortar merchants to help them gain some of the data-driven tools that the online space has to really better understand that customer base to better cater to them, get them to be more loyal, and repeat purchase and basically drive more value,” Tippets says.

Tippets believes that moving forward, payments aggregators are going to be key in bringing that interoperability between all these different players to be able to grow the business.

Also Read: Without privacy, Asia’s cashless society will only benefit governments

“That’s why … we’re all about building an ecosystem where we can bring a lot of value to our partners, to the merchants and to the consumers, so that they have a good enough reason to use the service six times a day all the time. Because it’s seamless, practical, ultra-safe, and because it’s everywhere,” Tippets closes.

Image Credit: Clik

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