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Razer Fintech leads consortium in digibank bid

Razer's chief strategy officer Lee Li Meng told BT in mid-December that it had been in talks with "prospective partners" to apply for a full-bank licence.

A CONSORTIUM including Razer Fintech and Sheng Siong's founders has submitted an application for a digital full bank licence in Singapore, focusing on the "underserved youth and millennials segment" for the bid, gaming lifestyle brand Razer Inc said in a statement on Thursday.

The consortium also includes insurance business FWD, Internet company LinkSure Global, Singaporean technology venture fund Insignia Ventures Partners, and vehicle wholesale marketplace Carro. The Lim brothers who founded supermarket chain Sheng Siong are also participating, via their private vehicle Sheng Siong Holdings. The mainboard-listed entity Sheng Siong Group is not involved in the bid.

Razer Fintech will take up a 60 per cent stake in the consortium, with the remaining interest to be held by the other strategic partners in the consortium.

Razer Fintech - the company's financial technology arm - plans to extend its fintech offerings to digital banking services by building a global youth bank, Razer Youth Bank, the company said.

To integrate lifestyle experiences to its digital banking platform, Razer Fintech has also gathered service providers including co-working space operator JustCo, travel company SkyScanner and global payments tech firm Visa.

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As part of its offerings, Razer Youth Bank intends to serve the needs of budding entrepreneurs and small and micro enterprises which have had challenges gaining access to capital to fund growth and digital transformation, the company said.

It also aims to promote financial literacy among youths, provide fair product offerings, and create an engaging banking experience. Razer Youth Bank is envisaged to be headquartered in Singapore, with ambitions to build a global banking network.

The Monetary Authority of Singapore (MAS) is issuing in 2020 up to five digital banking licences - two full bank licences that permit retail banking, and three for wholesale banking. The announcement of the award of the digital banking licences is expected to be in mid-2020.

Razer told BT in mid-December that it has been in talks with "prospective partners" to apply for a full bank licence, but said the application time frame was "tight". Digital banking applications in Singapore closed on Tuesday.

Other contenders for the digital full bank licence include Grab Holdings and Singtel which on Monday made public their joint application. Grab would hold a 60 per cent stake in the proposed consortium, with the telco giant holding 40 per cent. Both partners see financial services as a natural extension of their core businesses, senior executives from Grab and Singtel said on Monday.

Separately, a prominent consortium comprising OCBC, Validus Capital, Keppel Corporation and Vertex Ventures has decided against applying for a digital wholesale banking licence, BT understands. The late breakdown in talks, BT understands, comes amid Keppel's ongoing strategic review of its core operations, with Temasek Holdings due to take control of the conglomerate via a partial offer.

Among other things, Razer Inc's legal and financial obligations related to Razer Youth Bank are subject to the award of the licence by MAS, finalisation of the consortium arrangements, and compliance with the applicable regulations, including the listing rules of the Hong Kong stock exchange, where the company is listed.

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