UOB, PwC and SFA report reveals FinTech firms in Singapore attract most global funding within ASEAN
Singaporean FinTech firms are reported to attract more than half of of funding for the region, with Singapore also being named as the preferred location for FinTech firms, as 45% of all Financial Technology companies have been found to be based in the city.
The report, the product of a collaboration between United Overseas Bank (UOB),
PricewaterhouseCoopers (PwC) and Singapore FinTech Association, attributes the strength of Singapore’s FinTech scene to the encouragement by the city to innovate, supported further by the even distribution of funding.
The areas of insurance technology, payments and personal finance were named as the front runners of the Singaporean FinTech space.
The diversity and even distribution of funding has been named as an indication of the maturity of the Singaporean FinTech market, when compared to the rest of the ASEAN region, as well as the lack of focus in Singapore on payment-related solutions.
UOB’s Head, Group Channels and Digitalisation, Janet Young, said that “Singapore’s favourable regulatory and business environment, strong investor interest and maturing FinTech sector continue to make it an attractive base for firms that are looking to tap ASEAN’s growth potential. As such, more firms in the country have also graduated from pre-series to later-stage funding.”
“However, expanding into and within one of the world’s most diverse regions is not plain sailing. Therefore, in order to increase their chances of success, it is important for FinTech firms to find the right partner to supplement the experience, insights and connections required to navigate the differing regulatory frameworks and operating landscape across ASEAN,” she continued.
The report also found that FinTech firms in ASEAN are generally optimistic about their current and future funding needs, with almost half of those surveyed confident of raising more than USD10 million for their next funding round.
Wong Wanyi, FinTech Leader, PwC Singapore, said “This optimism is not surprising, given the promise that the ASEAN region brings and the liberation of the industry through digital banking licenses. The increasing penetration of mobile devices coupled with the capabilities of new innovative technologies have made FinTech firms a key driver in this evolving ASEAN financial services landscape, providing an experience that is easier, faster and more convenient.”
Wong continued, saying “That being said, the FinTech scene is very competitive so FinTech firms should be focused and have a clear value proposition. Scaling up should be at the right pace and for the right reason.”
58% of FinTech firms surveyed, however, stated that finding talent remains a challenge, and that this struggle was a key inhibitor in their regional expansion plans.
Chia Hock Lai, President, SFA stated that “FinTech firms need to consider if there is suitable and abundant expertise at the location they have chosen to scale their business. Given the long time it takes to hire the right talent, firms must plan ahead when it comes to expanding their workforce and business in a new market. One way that some firms overcome this challenge is to hire local talents at least six months ahead of their expansion into a new market.”