08 May 2022

Background Check on all the Winners of Malaysia’s Digital Banking Licenses

After we've written about the anticipated BNM announcement on Digital Bank license winners, many are curious & wondering why the hottest candidate Grab's name was not on the list?

What? Leading fintech/superapp company Grab is not one of the winners in getting the digital bank license in Malaysia? No worry... Hold on...

In this article, we will be highlighting the company background of all the FIVE digital bank winners (groups/consortiums).

Out of the 5 winning consortiums, 3 of them are majority-owned by
Malaysians, namely Boost Holdings + RHB Bank Berhad; Sea Limited + YTL Digital Capital; and KAF Investment Bank.

For more details, here you go...

Conventional #1: Boost & RHB Bank

No stranger to Malaysians, especially during the initial years of e-wallet in the local scene with Boost dishing out generous cashback to their users. Boost is the fintech arm of Axiata that unifies financial services spanning payments, micro-financing, micro-insurance, cross-border content services and merchant solutions. Boost has over 200,000 merchant touchpoints available nationwide and counting.

Picture source: CleverTap

Ranked among the top banks in Malaysia and with a significant presence in ASEAN, RHB Banking Group is a fully integrated financial services group in Malaysia and has strong market leadership in Malaysia across targeted products and segments. With more than 14,000 employees Group-wide, RHB’s presence spans 9 countries in the ASEAN region.
Axiata's largest shareholder is Khazanah Nasional Bhd, while RHB's largest shareholder is EPF. This winning consortium will be led by Boost with its 60:40 ownership arrangement with RHB. One from tech, one from financial. Perfect married to produce a great FinTech venture?

Conventional #2: GXS Bank & Kuok Brothers

GXS Bank is the Grab-Singtel consortium (does this name come from Grab x Singtel?) that was granted a digital banking license in Singapore. The Grab-Singtel venture will hold a 55.45% stake in the proposed Malaysia digital bank. Notably, Grab has appointed Ms. Pei Si Lai, a former senior from Standard Chartered as its CEO-designate and they are looking to fill 200 news roles for the bank. πŸ˜ƒ

Picture source: Grab Singapore

How about Kuok Brothers? Well, in Malaysia, when you heard about the word 'Kuok' in business, then you should already know that this might be related to the richest man in Malaysia, Mr. Robert Kuok. Yeah! Bingo! Since both Grab-Singtel are foreign entities, it's pretty natural to partner with influential Malaysian. Right?

Conventional #3: Sea Limited & YTL

Another existing digital bank licensee from Singapore, Sea Limited is widely known as the parent company of Shopee, with fintech ventures in Malaysia such as ShopeePay and SPayLater.

Another Singapore company, so, partnering with another Malaysia company lol. Well, the core businesses of the YTL Group comprise utilities, construction contracting, cement manufacturing, property development and investment, hotel development and management, e-commerce initiatives and internet-based education solutions and services. Currenlty, the conglomerate amassed a total assets of RM72.1 billion (USD17.2 billion) (as at 31 December 2021).

Interestingly, YTL Power had just recently sell off its stake in Australia's ElectraNet for RM3.07 billion, saying that the company will utilise bulk of the proceeds to fund it's new renewable energy projects? Would YTL channel some of the proceeds to this new digital banking venture?

Islamic #1: AEON Financial Service, AEON Credit Service & MoneyLion

AEON Financial Services is "a comprehensive financial group with roots in the retail sector" which provides financial services that are closely related to customers' daily life in 11 Asian countries including Japan.

Meanwhile, AEON Credit Service is a non-bank financial institution focusing in consumer financing, hire purchase installment plans for consumer durables and motor vehicles, personal financing and issuance of payment cards.

AEON Financial Service holds a 60% stake in the consortium. The two AEON entities are mainly strong in their financial capabilities. Maybe, that's the reason why they want to rope in MoneyLion to form the consortium.

MoneyLion is a US-based fintech company which was founded in 2013 offers lending, financial advisory, and investment services to consumers. The company was listed in the NYSE in year 2021 via SPAC route, and one of its co-founders is a Malaysian. Wow! 😎😍

Malaysian, Mr. Foong Chee Mun is the Chief Technology Officer and Co-Founder of MoneyLion Inc. He has been named as one of the top 25 FinTech CTOs of 2020 by The Financial Technology Report.

Islamic #2: KAF Investment Bank, MoneyMatch, Carsome and Jirnexu

KAF Group of Companies is a well diversified Malaysian financial services group with interests in Money Market Activities, Investment Banking, Stock Broking, Islamic Banking, Research, Investment Fund Management, Fund Advisory and Trustee services.

MoneyMatch is a multi-national financial technology firm focusing on international payments. Carsome is Southeast Asia’s largest integrated car e-commerce platform, providing end-to-end solutions to consumers and used car dealers. Jirnexu delivers end-to-end digital acquisition tools and solutions for FSIs and service providers in Asia. 

Wow! When these four guys from different verticals coming together to form the consortium, it sounds interesting man! What kind of sparks can we expect? Let's see... πŸ’₯πŸ’₯πŸ’₯


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