Singapore’s Hong Leong Finance is seeking to partner with fintechs to jointly apply for one of Singapore’s five digital bank licences. The licences will be issued by the Monetary Authority of Singapore in 2020.
Hong Leong Finance is currently in discussions with technology companies about a joint application for the licence, President Ang Tang Chor told the media.
The application rules necessitate that one of the parties applying for digital banking licence must have three-plus years of business record in ecommerce or technology.
The application rules necessitates that one of the parties applying for digital banking licence must have three-plus years of business record in ecommerce or technology.
Hong Leong Finance seeks to reposition itself as a tech-savvy lender and lure new customers. Even though it has an extensive reach and a developed customer base — it lacks the platform required to get the licence.
The five digital bank licences will be granted to fintechs and other non-bank establishments to boost financial competitiveness in the country. “The next generation of depositors and clients are going to be people who are tech-savvy so we will have to go in that direction,” Ang told the media.
Hong Leong Finance was founded in 1961 — operating a network of 28 branches and 12 SME centres in the country. The lender’s market capitalisation as of mid-2019 stood at $870 million, with a total deposit of nearly $12 billion.
The new licence regime has encouraged new entrants, non-banking players, and traditional lenders to collaborate with each other. The licence applications are open to local companies and those headquartered in the country. That said, foreign establishments can pursue the opportunity by forming a joint venture with a Singapore company.