Start Singapore: Lending start-up offers credit risk assessment

(From left) Validus Capital co-founders Mr Nahata, Yash Poddar and Richard Hoon with NUS' Prof Duan. The online lending platform uses a credit- rating default algorithm developed by NUS' Risk Management Institute to help assess borrowers' credit rati
(From left) Validus Capital co-founders Mr Nahata, Yash Poddar and Richard Hoon with NUS' Prof Duan. The online lending platform uses a credit- rating default algorithm developed by NUS' Risk Management Institute to help assess borrowers' credit rating.PHOTO: VALIDUS CAPITAL

Lending start-up offers credit risk assessment

Validus Capital is the latest local online lending start-up to launch here. It joins a group of online lending platforms, including Funding Societies, MoolahSense, FundedHere and Capital March.

Validus aims to hook up astute investors with small and medium-sized enterprises (SMEs) which need cash to cover short-term needs. SMEs can borrow from $100,000 to $1 million on its platform.

One key feature of Validus' service is a credit-rating default algorithm developed by the Risk Management Institute at the National University of Singapore.

This algorithm is integrated with Validus' software to provide a better assessment of borrowers' credit rating. The software also gives an interest rate for each loan, commensurate with the credit rating.

Co-founder Vikas Nahata said the firm wants to help its investors to better judge a borrower's ability to repay a loan.

"There are many variables in assessing credit ratings, including behavioural and demographic data and payment information records. NUS helps us to capture another two important criteria for SMEs, namely ability to pay and willingness to pay," he said.

"Putting all these five variables together has not been done by other online lending platforms."

Using this system, Validus has been able to turn away loans from potential defaulters since it started operations in November, he added. Since then, it has provided $2.2 million worth of loans to 14 SMEs. It has a pipeline of $4 million from another 12 SMEs.

Professor Duan Jin-Chuan of the NUS Risk Management Institute has studied about 6,000 listed companies in the world to assess their credit rating. Using this database, he can provide Validus with data across similar companies in terms of size and in a similar economy as Singapore so that the lending platform can assess credit risk.

Validus is targeting lenders like high-net-worth individuals, family offices and hedge funds seeking alternative investments that give better returns.


Migme buys Indonesian e-commerce portal

Singapore-based social commerce start-up Migme has bought Indonesian e-commerce portal Shopdeca for US$710,000 (S$960,000).

Migme, which provides a content creation platform for celebrities to communicate with their fans and followers, can plug into Shopdeca's e-commerce platform.

Migme co-founder and chief executive Steven Goh said these people can recommend Shopdeca's products to their fans and followers. Migme - listed on the Australian Stock Exchange - also wants to partner other e-commerce portals like Lazada.


KPMG opens technology test lab for businesses

Management consulting firm KPMG has opened an innovation lab here to help businesses get a better idea of the innovations and technologies created by start-ups anywhere in the world.

Called Digital Village, it was set up to bridge and connect businesses to start-ups.

KPMG has opened a Downtown Lab in Hong Leong building to focus on financial technologies. A Block 79 Lab at Launchpad@One North in Ayer Rajah industrial estate will open soon.

This lab will work with start-ups and venture capital firms on non financial technology innovations.


Walden invests $3.5m in F&B tech start-up

TabSquare, a Singapore based start-up that offers a technology-based operations management and customer engagement platform for the food and beverage industry, raised $3.5 million, led by venture capital firm Walden International.

Other investors include Infocomm Investments, the venture unit of the Infocomm Development Authority; local private equity firm Phillip Private Equity; and Raging Bull, the investment vehicle of serial entrepreneur Ivan Lee.

TabSquare offers various features to restaurateurs. One offers a customised tablet menu. Tabsquare was founded by Insead business school graduates Anshul Gupta, Chirag Tejuja and Sankaran Sreeraman.

Grace Chng

• Send news on start-up development to chngkeg@sph.com.sg

A version of this article appeared in the print edition of The Straits Times on April 14, 2016, with the headline 'StartSingapore'. Print Edition | Subscribe