Startups like Wallex have been digitizing finance for largely underserved Southeast Asian SMEs
Singapore-headquartered B2B fintech startup Wallex Technologies, which focuses on small and medium enterprises (SMEs), has closed its Series A round of funding for an undisclosed amount, the company said in a statement.
The funding was led by Ant Financial-backed early stage-investor BAce Capital, and Jakarta-based venture capital firms SMDV and Skystar Capital, with participation from existing investors, it added.
The fresh funding will be used towards product development and market development, with a focus on Asian markets and currencies, Wallex told Jumpstart via email.
Having acquired a money transfer license in Hong Kong late last year, Wallex is looking to expand to the Hong Kong market post their Series A, along with scaling its presence in existing markets of Singapore and Indonesia, the company notes in their email.
The company adds that they will be investing resources into enhancing capabilities in hedging products and building out their offering on collection accounts.
“This funding will help us build out more robust capabilities for our SME customers to manage their cash flow and hedge their forex risk within a single platform,” CEO & Co-Founder of Wallex Jody Ong said in the statement.
With a focus on “future-ready services like virtual receivable accounts and multi-currency wallets,” the company will also move ahead with hiring and partnerships for business expansion, Ong added.
Wallex addresses the foreign exchange and cross border payment needs of SMEs, supporting over 40 currencies. Over half of its business comes from Asian markets, the statement said.
Managing Director at BAce Capital Mulyono Xu noted in the statement, “We do see the importance of digital payments post COVID-19 to enable more SMEs to participate in the economic revival process. We believe Wallex has great potential to become a digital payment and wallet solution for this underserved segment.”
Wallex had earlier raised an undisclosed amount in a pre-Series A round led by Singapore-based venture capital firm Beenext in 2018, and officially launched in Indonesia just a month after the round.
An earlier statement noted that the company had touched $1 billion through annualized gross transaction value (GTV) by November last year.
Wallex’s growth is indicative of the boom in the Southeast Asian fintech industry. Where Hong Kong was once seen as the financial hub for the region, the fintech industry in all of Southeast Asia is now seeing a period of accelerated growth.
Digital payments are expected to touch $1 trillion in GTV by 2025, with revenues from digital financial services expected to grow over 300% from $11 billion currently to $38 billion in 2025, according to a study by Google, Temasek, and Bain & Co.
It also notes that digital payments and remittances are at an “inflection point”, catching up with growth in high-momentum sectors like ride-hailing and ecommerce.
Additionally, the study reports that SMEs in the region, which are largely underbanked and have poor access to affordable credit, are increasingly moving towards fintech alternatives to meet their funding needs.
With increasing internet and mobile penetration amongst Southeast Asian countries, this presents a unique and massive opportunities for startups like cross-border transaction alternatives such Wallex, Validus, and TranSwap, to cut themselves a slice of a growing pie early on.
SME Fintech Company Wallex Wraps Series A, Investors Include Ant Financial-Backed BAce Capital
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