As I mentioned in my previous article, “Southeast Asia is the New El Dorado for Fintech” — this region is experiencing a lot of growth right now in all sectors — but especially when it comes to financial technology.
There are so many exciting startups emerging from this region, creating innovative finance apps and software and really changing the game. Let’s take a look at some of the hottest Fintech companies in Southeast Asia to keep an eye on in the future.
Many Filipinos who work abroad in Hong Kong want to be able to send money back home quickly and easily. Toast is a peer-to-peer money transfer app that allows them to do so, directly from their smartphone.
In the past, migrant workers were reliant on transfer services such as Western Union and Moneygram. The service is cheaper than using a bank transfer, while also being faster than a money transfer shop.
The team behind Toast believe that there’s no reason money transfers shouldn’t happen in real time — no need to stand in a queue at the bank or wait days for the cash to arrive. Users don’t even need to have a formal bank account.
The company has obviously identified an important need. 10 months after the launch of the app in March 2016, remittances from Hong Kong to the Philippines had grown to more than $7 million HK ($902,750 USD) per month.
Watch this company closely — they plan to expand into South Asia and Southeast Asia. They have secured funding and obtained a license from the Monetary Authority of Singapore to operate as a remittance agent there.
Many members of an emerging middle class around the world find themselves in a bit of a Catch 22. They have steady income, but they can’t access credit because they don’t have a formal credit history. However — they can’t build a formal credit history because they can’t get credit.
So, how can you determine their creditworthiness?
LenddoEFL says: use social media.
LenddoEFL is a software-as-a-service company based in the Philippines which uses non-traditional data such as smartphone records and social media to ascertain customer’s financial stability. This information can be used to determine who borrowers are — and their attitudes towards credit.
LenddoEFL has developed this technology based on four years of actual online lending experience, which includes the collection and analysis of billions of data points. Over 12,000 variables are analysed for each application, creating a very accurate picture of the individual’s creditworthiness.
It allows lenders to extend credit to these individuals, so that this emerging middle class can be connected to the financial tools they need to build a better future.
LenddoEFL is growing fast. They launched in the Philippines in 2011, but have quickly expanded to other markets such as Colombia, Mexico, India and South Korea. Their ultimate goal is to provide financial inclusion for “at least a billion people” in developing nations around the world.
In Vietnam, a country where most people don’t have credit cards, a mobile payment app like MoMo can really come in handy. With 25% of the population below the age of 25 and a growing percentage of smartphone ownership, there’s real potential for MoMo to be disruptive.
MoMo customers can use the app for a lot of different services, such as paying bills like water, cable and electricity — as well as buying movie tickets and shopping online. Signing up for an account is easy. You simply have to provide your phone number and a verification code will be messaged to you — which you can then use to activate your account.
Just one year after MoMo launched their mobile wallet and payment app, they announced that the app had one million users. This is in addition to the 2.5 million mobile money customers that MoMo announced in 2016. In 2017, MoMo signed an agreement with Uber to enable passengers to pay for rides using their MoMo app.
Founded in Malaysia in 2015, Currenseek is a mobile app that is designed to help travelers find the best exchange rates near them, so that they can avoid getting ripped off by moneylenders. After all, there’s nothing more frustrating than saving up a lot of money for your travels, only to have most of it used up by currency exchange fees.
The mobile app allows users to see real-time information on current exchanges rates at outlets that are closest to them. The information in the app is constantly updated, so users can always see the most current rate. Plus, the app shows competitive street rates — rather than just the wholesale interbank rates.
The app was created in Kuala Lumpur by Amir Haghbin, who was inspired by the frustration of converting US dollars to Malaysian Ringgit and the lack of consistency between exchange outlets.
After all, independent currency exchange outlets actually operate in quite an unsophisticated way — they often buy low and sell high just like retailers. So, this means that their rates will depend on rent, salaries, overheads and other factors — even the location of the outlet. There can be 20–25 money changers all in one area in Kuala Lumpur and the difference between their rates can be as much as 25%.
As travelers become more and more informed about how to get the most for their money, they will seek out apps such as this one to avoid getting ripped off by money lenders.
What Southeast Asia Fintech Firms are YOU keeping an eye on?
Do you know about a company in Southeast Asia that is doing something bold, notable and innovative? Let me know about it in the comments. I always love to hear about new developments in Fintech coming out of Southeast Asia.
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I’m a co-founder at TendoPay, a financing company in the Philippines, also co-founder at Candy Banners, a digital advertising studio and Stinson Design, the leading presentation consultants in North America. Previously founder of social game Predico and on the board of ad tech company Viewor.
Follow my adventures on Instagram @timgrassin