Finance companies cross S $ 2 billion mark in SME loan disbursements

Funding Societies, a digital financing platform for SMEs in Southeast Asia, announced that it has disbursed S $ 2 billion in business financing to small and medium-sized enterprises (SMEs) in the region as she enters her sixth year of activity.

Finance companies said the amount was partially funded by more than 200,000 retail investors on its platform and was disbursed through more than 3.7 million loans.

The company recorded S $ 850 million in disbursements in 2020, while its platform’s overall default rate remained below 2% during the pandemic.

In order to mitigate the risk of its portfolio in 2020, finance companies tightened their credit underwriting criteria to ensure that only quality ratings were crowdfunded and focused on companies likely to thrive during the pandemic. .

These priority sectors included health care, medical supplies and transportation, to name a few. Finance companies saw an 18% growth in the number of platform investors from January 2020.

According to Ernst & Young’s 2020 ASEAN SME Transformation Survey, 68% of the 1,200 SMEs surveyed in the six largest ASEAN countries, namely Singapore, Indonesia, Malaysia, Thailand, the Philippines and Vietnam are open to non-traditional lenders.

The main attractions are speed and convenience; SMBs prefer the much faster and more flexible loan approval process as well as an electronic Know Your Customer (KYC) process, which typically does not require asset security or a visit to the bank branch.

Meanwhile, the Asian Development Bank estimates an annual trade finance gap of US $ 150 billion in Asia, and 60% of companies rejected for trade finance have not proceeded to trade due to lack of finance. .

Co-founder and CEO of the Funding Societies group, Kelvin Teo

Kelvin Teo

Kelvin Teo, co-founder and CEO of the Funding Societies group, said:

“We are delighted to have taken this important step before we even achieved it. This is an important opportunity and an encouragement for us. There is much more to do as we continue to serve the needs of SMEs and investors in the region. “

We are grateful to have raised Series C funds last year, which allows us to further assist SMEs even in uncertain times ”,

Funding Societies recently launched its fourth market in Thailand with plans to further expand its national and regional presence in the near future.

Featured Image: Kelvin Teo, Co-Founder and CEO of Funding Societies

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