The Singapore-incorporated digital wholesale lender ANEXT Bank, a wholly-owned subsidiary of the fintech giant Ant Group, announced its soft launch on Monday.
The digital bank, which had received the Monetary Authority of Singapore’s (MAS) nod to commence operations on June 2, will provide financial services to local and regional MSMEs, especially those engaged in cross-border operations, for their growth and global expansion.
ANEXT Bank also signed a two-year MoU with Proxtera — a hub supported by MAS, the Infocomm Media Development Authority, and several private sector entities — to transform and enable holistic cross-border trade among SMEs and businesses by making marketplaces efficient and discoverable globally, with embedded financing, fulfillment services, and SME empowerment.
ANEXT Bank will be the first digital wholesale bank in Singapore to partner Proxtera to provide financing solutions to buyers and sellers on its network.
The bank’s soft launch comes days after Green Link Digital Bank (GLDB) became the first digital bank to operate in the city-state on Friday.
Both Ant Group and GLDB had secured digital full-bank licences from MAS in December 2020. New York-listed Sea Ltd and a Grab-Singtel consortium were among the other players who received the nod to set up digital full banks.
Full digital banks can cater to both retail and corporate clients while wholesale banks can only serve non-retail customers.
Toh Su Mei, CEO of ANEXT Bank believes that the next generation of financial services must be accessible and effortless for growing businesses. “Amid rapid acceleration in the digital economy, business models are changing and pivoting to become digital-first, if not adopting a hybrid model. Financial services have to evolve and be where SMEs are doing their businesses digitally,” she explained in a statement announcing the soft launch.
Sopnendu Mohanty, CFO of MAS reckons that continuous innovation and new capabilities that digital banks are slated to bring will “no doubt add more engines of growth to Singapore’s financial sector”. MAS expects the digital banks to “synergise with financial institutions and raise the bar in delivering quality financial services, and better support the growth of SMEs in Singapore, the region, and emerging markets,” he added.
Other Southeast Asian countries have also been approving digital banking licences. For instance, the Bangko Sentral ng Pilipinas (BSP) in the Philippines has approved six applications for digital banking licences. DealStreetAsia had reported in May this year that Sea Ltd is said to be launching its digital bank in the Philippines in June. The group had launched Bank SeaBank Indonesia in the latter half of 2021.
Meanwhile, Bank Negara in Malaysia has announced five successful applicants for digital bank licences. The Bank of Thailand, too, has announced plans to issue guidelines for digital banks by this month.
Strong Southeast Asian presence
Ahead of the soft launch of its digital wholesale bank in Singapore, Ant Group began recruiting for 20 positions in line with its efforts to double down on its expansion in Southeast Asia.
News reports indicate that the group has around 300 staff in Singapore, who oversee its operations in the region.
The roles it was recruiting were in the areas of credit management, security and marketing, payment solutions and compliance for Alipay+, a cross-border digital payment service introduced in 2020, which can process a range of mobile payment methods from around the world.
Alipay+ has been at the heart of Ant Group’s global strategy. The company launched several local Alipay wallets in Southeast Asia by picking up shares in local companies in countries including Indonesia, Malaysia, the Philippines, Thailand, and Vietnam.
Ant Group has plans to connect the Alipay mobile wallet with other mobile payment methods for interconnection.
Overall, the company has invested in nine fintech operators across Asia since 2015. This includes Mynt, a Phillippines-based fintech valued at $2 billion after its fundraising in November 2021, and eMonkey, a Vietnamese e-wallet.
The Ant Group has also backed e-wallets like Touch’n Go in Malaysia and Dana in Indonesia. It also backed Indian digital payment company Paytm, which recorded the country’s biggest IPO last November.