SBF, MSIG to join Ron Sim's V3 group in Singapore digibank race

Singapore

IN a surprise twist, the Singapore Business Federation (SBF) will be joining a consortium, led by Ron Sim's V3 Group and stored-card operator EZ-Link, that is gunning for the digital full bank licence in Singapore.

Sources tell The Business Times (BT) that SBF will be taking a small minority stake of below 10 per cent, in a move to support small and medium-sized enterprises (SMEs) in their funding needs.

A statement released on Sunday confirmed an earlier report by BT that V3 Group, EZ-Link, property group Far East Organization and Temasek-owned Heliconia Capital were in talks to form a digibank consortium.

Another newly-revealed addition is insurer Mitsui Sumitomo Insurance through its subsidiary MSIG Singapore, making this digibank grouping the biggest seen so far with six members altogether.

The consortium, called Beyond, said in a statement that it aims to serve the needs of the SME community and their families through an industry-specific approach, helping them with financial planning through the use of "behavioural economics and innovative processes".

The SME segment, especially the micro-enterprises and startups, is often described as underserved as they tend to face more difficulty managing their finances and securing funding from traditional banks.

The addition of SBF could potentially boost the consortium's connections in the SME segment, as it represents about 27,000 companies, as well as key local and foreign business chambers.

It is compulsory for all Singapore-registered companies with paid-up capital or authorised share capital of S$0.5 million and above to be members of the SBF.

There are now three officially announced contenders for the two digital full bank licences on offer which allow licensees to collect deposits from retail customers.

They require an eventual capital requirement of S$1.5 billion and will also need to be Singaporean-controlled.

The other two players which have confirmed that they have thrown their hats into the ring for the digital full bank licence include Grab and Singtel, as well as a Razer-led consortium.

Gan Chee Yen, chairman-designate of the Beyond consortium, said that the proposal represents "the combined strengths of some of Singapore's most established companies and their reach to SMEs and their workforce".

"We have developed a suite of innovative products and services to cater to the needs of digital natives, the gig economy, the silver generation and SMEs operating in different industries," he added.

Mr Gan is also the senior adviser to V3 Group's newly set-up unit, V3 Fintech.

In December last year, SBF tied up with V3 Fintech to set up a digital academy known as Beyond Lab to help SMEs train their digital competencies. Beyond Lab will focus on areas such as data analytics, including that to support green solutions, and fintech innovations that can help Singapore businesses grow and expand in the region.

Ron Sim, founder and executive chairman of V3 Group, said: "Pure digital banking is the future, and we aim to embrace it together with the rest of Singapore's promising fintech community."

Applications for the five digital banking licences - two retail and three wholesale - closed on Dec 31, 2019.

The Monetary Authority of Singapore is expected to announce the results of the digital banking applications by mid-2020.

READ MORE: Temasek-backed firm leads consortium to vie for digital wholesale bank licence