V3 Group, EZ-Link lead team vying for digital bank licence

Consortium wants to focus on SMEs, their workers and families

A consortium led by entrepreneur Ron Sim's V3 Group and card and payments firm EZ-Link is counting on its diverse experience, in areas from wellness products to MRT farecards, in its bid to run a digital bank.

Called Beyond, it is seeking a digital full bank licence, the third applicant to announce its bid thus far.

It also comprises private property developer Far East Organization, the Singapore Business Federation (SBF), insurer Mitsui Sumitomo Insurance (MSIG) and Temasek subsidiary Heliconia.

The group said in a statement yesterday that it wants to focus on the needs of small and medium-sized enterprises (SMEs), which employ nearly 70 per cent of Singapore's workforce. It also wants to reach out to companies and individuals across industries.

A digital full bank licence will allow Beyond to serve retail customers and extend loans to individuals as well as companies.

Its application was submitted before Dec 31 last year, the last day for firms to apply for the licence.

The proposed bank will be headquartered in Singapore.

Beyond's announcement comes three days after gaming company Razer said it had, through a consortium that includes Sheng Siong Holdings and four other partners, applied for a digital full bank licence. Telco Singtel and tech company Grab have also formed a consortium to bid for a licence.

The Monetary Authority of Singapore said last June that it would issue up to five new digital bank licences for both full and wholesale banks to players which may not have an established record in banking.

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

He added: "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."

 
 
 

Last year, SBF and V3 Fintech, the financial technology arm of lifestyle products group V3, set up a regional digital academy called Beyond Lab. It helps SMEs acquire digital technology to increase operational efficiency and competitiveness, in areas like data analytics.

Mr Ho Meng Kit, chief executive officer of SBF, said that although SMEs play a significant role in the economy, some of them, especially smaller enterprises and start-ups, tend to face more difficulty in managing their financing and securing funding from traditional banks.

"There are significant gaps in the SME financing landscape that Beyond can address," he added.

Beyond's plans, he said, will help local businesses expand into new markets, as well as "enhance the services SBF can provide to its membership base of over 27,000, elevate their competitiveness and create better jobs for Singaporeans".

The consortium also said it will leverage the core strengths and networks of members like EZ-Link, which issues the cards commonly used for public transport and retail and has a customer base of around five million active cardholders.

In addition, general insurer MSIG will be developing customised insurance solutions to meet the needs of the under-served. Beyond expects to offer more choices in the form of micro-coverage, modular and usage-based insurance.

Mr Ron Sim, founder and executive chairman of V3 Group which owns, among others, high-end massage chair manufacturer Osim and luxury brand TWG Tea, said: "As a business builder and employer, I understand the challenges faced by many SMEs and their workforce.

"We also cannot be solely focused on catering to the digital natives," he added. "The vast majority of people in Singapore are part of the SME ecosystem, and we want to help them and their families."

Added Mr Nicholas Lee, CEO of EZ-Link: "We will contribute our in-depth knowledge of the daily struggles of merchants and consumers and our experience in innovative use of payment technology."

Observer Varun Mittal said the diverse exposure of Beyond's partners is a plus.

"As the digital banks will not be having physical branches and access to ATM network, the key part will be daily life touch points through transport cards, retail shops and SME service providers," he said.

"Another key aspect of long-term sustainability is the profitability and cash generation capability of consortium partners to be able to fund the digital bank through the initial years of operation till break-even point is achieved."

A version of this article appeared in the print edition of The Straits Times on January 06, 2020, with the headline 'V3 Group, EZ-Link lead team vying for digital bank licence'. Print Edition | Subscribe