More China players emerge among bids for Singapore digibank licences

Singapore

TWO more Chinese players have made public their digital wholesale banking bids in Singapore, bringing the reported tally to seven Chinese names vying for these new licences here.

Eyeing just one of three wholesale licences up for grabs, China-based software giant Shanghai Jifu Information Technology Service has teamed up with JIC Technology Investment, Chinastone Capital Management, security tech firm Hong Heng, industrial blockchain group Shenzhen Xin-an Digital Technology, and US-based Grace May to bid for the licence.

Under the name of Asia Digital Bank Corporation (ADBC), the proposed consortium told The Business Times (BT) it aims to provide efficient and affordable financial services for small- and medium-sized enterprises (SMEs) in Asia by leveraging the experience and resources of all partners, and using fintech such as blockchain and artificial intelligence.

ADBC's services will include same-day payment, settlement and cross-border remittance services for SMEs.

The digital bank hopeful said it will also provide customised financial products and services tailored to the different needs of SMEs - including receiving payments, foreign exchange financing, and wealth management - through real-time acquisition and analysis of "massive" business data.

Notably, Shanghai Jifu is a leading player in the field of payments and fintech in China, serving over 25 million SME clients on its platform.

The firm's core focus is on third-party payments, covering credit investigation, data service, telecom value-added, commercial factoring and other business areas.

There is increasing certainty that the Chinese are eager to play, where digital banking is concerned.

Separately, Chinese real estate developer and state-owned enterprise Greenland Group, through its investment arm Greenland Financial, has formed a consortium with partners including Chinese financing platform MinIPO to vie for a wholesale digital banking licence in Singapore.

It intends to build a digital bank that will tap China's financial technology to serve SMEs in the Republic, leveraging the resources and capabilities of the joint parties, they told Lianhe Zaobao in an exclusive interview.

Geng Jing, executive president of Greenland Group and chairman of Greenland Financial, pointed out that the group and MinIPO have worked together previously. The formation of this group will be a strong combination of large-scale state-owned enterprises with fintech leaders in China, he said.

The consortium will also collaborate with top academic institutions in Asia in areas such as artificial intelligence and financial risk management to support the development of wholesale digital banking and groom fintech talent, he added.

The latest two contenders add to a growing list of Chinese players joining the digital banking fray in Singapore. On Tuesday, BT reported that China-based Zall Smart Commerce Group is teaming up with Japanese trading conglomerate Marubeni Corporation, and Singapore supply chain platform provider Global eTrade Services (GeTS), for a wholesale banking licence.

The Monetary Authority of Singapore said earlier this month that it has received a total of 21 digital bank applications - 14 of them wholesale, and seven for the full-bank licence.

On the wholesale side, Jack Ma's Ant Financial has put in a bid, while TikTok owner ByteDance is also reportedly among the contenders.

Another applicant is Singapore's iFast Corporation, which formed a consortium with two major Chinese partners, Yillion Group and Hande Group. Yillion operates one of four digital banks in China, while fintech company Hande is founded by Cao Tong, the former president of WeBank, China's first digital bank founded by Tencent.

Xiaomi Finance, a subsidiary of Chinese electronics company Xiaomi Corporation, is in a consortium with Hong Kong's AMTD Group, peer-to-peer lending platform Funding Societies and Singapore utilities provider SP Group.

Others include a consortium led by Hong Kong-listed Sheng Ye Capital, and a spin-off from venture capital firm Life.Sreda, known as Arival.

The digital wholesale bank licence will allow successful applicants to serve SMEs and other non-retail segments. There is a capital requirement of S$100 million, and foreign entities can take a majority stake.

On the other hand, the digital full-bank licence - there are two available - comes with an eventual capital requirement of S$1.5 billion, and will require the entities to be Singaporean-controlled.

Results are likely to be released by mid-2020 and the new digital banks are expected to start operations by the middle of 2021.