Finance

Singapore fintechs dominate funding within Asean: report

Tue, Nov 12, 2019 – 2:00 PM

FINANCIAL technology (fintech) firms in Singapore continued to attract the lion's share of global funding among Asean countries, and the Republic remains the preferred base for fintech firms in the region, a new report by United Overseas Bank (UOB), PwC and the Singapore FinTech Association (SFA) has found.

"Funding into Asean has grown more than 30 times since 2014, reaching a new high of US$1.14 billion as at end September 2019. While other Asean countries have accelerated the development of their domestic fintech sector, it is Singapore, with its more mature fintech scene, that continues to attract the most funding within Asean," the report said.

In its third edition, the report noted that of total funding in 2019 to date, just over half, or 51 per cent, of total funding went into Singapore. The city-state also continues to be the number one regional base for fintechs, and is home to 45 per cent of such firms in Asean.

In line with the country's push to encourage fintech innovation across different areas, funding for Singapore-based fintech firms was the most evenly distributed, with insurance technology, payments and personal finance leading the way.

According to the report, the diversified funding indicates that Singapore's fintech landscape is more mature, compared with other Asean markets, where the fintech sector is still nascent, and is largely focused on payment-related solutions.

Janet Young, head of group channels and digitalisation at UOB, said: "Singapore's favourable regulatory and business environment, strong investor interest, and maturing fintech sector continue to make it an attractive base for firms that are looking to tap Asean's growth potential. As such, more firms in the country have also graduated from pre-series to later-stage funding.

Notably, businesses were the main target customer segment for fintech firms (79 per cent). Of these, financial institutions made up half of the target segment, followed by corporates (17 per cent), and small and medium-sized enterprises (12 per cent). Consumers and startups made up the rest (21 per cent).

In addition, the report also found that fintech firms in Asean are generally optimistic about their funding needs, with almost half of those surveyed confident of raising more than US$10 million for their next funding round.

Wong Wanyi, fintech leader at PwC Singapore, noted that this optimism is not surprising, given the promise that the Asean region brings, and the liberation of the industry through digital banking licences.

"The increasing penetration of mobile devices coupled with the capabilities of new innovative technologies have made fintech firms a key driver in this evolving Asean financial services landscape, providing an experience that is easier, faster and more convenient. That being said, the fintech scene is very competitive, so fintech firms should be focused and have a clear value proposition. Scaling up shouldRead More – Source

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