Ant Group’s first overseas digital wholesale bank to offer SME loans

SINGAPORE — Ant Group, the Chinese fintech giant controlled by billionaire Jack Ma, marked the start of an expansion outside of Greater China on Monday (June 6) with its first digital wholesale bank in Singapore.

ANEXT Bank, a wholly-owned subsidiary of Hangzhou-based Ant, is one of two digital banks to be licensed by the Monetary Authority of Singapore (MAS). Mr. Ma’s internet company, Alibaba, owns about 30% of Ant.

Singapore-based ANEXT Bank said it will focus on providing digital financial services to local and regional micro, small and medium-sized enterprises (SMEs), especially those engaging in cross-border operations for growth and global expansion.

The digital bank received MAS approval on June 2 and will offer online services from the third quarter of the year.

This is where SMBs can create an online ANEXT business account and dual-currency deposit account with proprietary security measures, including three-factor authentication verification. They will also be able to take advantage of features such as remote onboarding and daily interest.

ANEXT Bank’s managing director, Ms. Toh Su Mei, said the interest rates offered will be indexed to the market.

She told media that the bank can help SMEs in Singapore explore opportunities in Greater China and facilitate business relationships.

The digital bank has entered into a two-year agreement with Proxtera – an entity that digitally connects business-to-business marketplaces, service providers and trade associations – to improve cross-border trade between SMEs and businesses.

ANEXT Bank is Proxtera’s first participating digital wholesale bank in Singapore and will provide financing solutions to buyers and sellers in the network.

Proxtera CEO Saurav Bhattacharyya noted that the goal is to help or work with the underserved or unserved, which is a new source of revenue for the company.

“There are multiple trade corridors with China that we could seek to strengthen, but our partnership is primarily about enabling the financing itself, and SMEs need financing,” he said.

Asked how digital banking will be affected by China’s slowdown, the mainland’s tightened rules on tech companies and tech layoffs there, Ms Toh said the bank was “well capitalized”.

There are no details regarding the target revenue percentage that ANEXT would contribute to Ant Group so far, as the team is “just getting started” and it’s still too early to share.

“We’re not even in full launch yet. So the focus is really on building a sustainable business model to serve SMEs,” Ms. Toh said.

Without disclosing the current size of the team and how many more it will hire, Ms Toh said that “we will expand the team as we grow our business”.

Sopnendu Mohanty, fintech director of MAS, who was at the bank’s soft launch, noted that one of the benefits of having ANEXT is that local Singaporean talent will be nurtured. He added that he expects the bank to “hire a lot” of talent here and train them.

The launch of ANEXT Bank comes after Green Link Digital Bank, backed by Greenland Group, announced last Friday that it was open for business. The two digital wholesale banks were each licensed by MAS in 2020.

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