Ron Sim's V3 Group eyes digibank bid with EZ-Link, FEO, Heliconia

Singapore

RON Sim's V3 Group is believed to be in talks with stored-value card operator EZ-Link, property group Far East Organization and Temasek-owned Heliconia Capital to form a consortium to gun for a digital bank licence in Singapore.

The Business Times understands that the partners are targeting one of the two digital full-bank licences in Singapore that will allow it to accept deposits from retail customers.

It is believed that the final line-up of the consortium is not yet confirmed and that there might be new players joining the fray.

Applications for the five digital banking licences up for grabs - two in retail banking and three in wholesale banking - close on December 31.

Between the four names, they account for millions of touchpoints in Singapore, on the back of EZ-Link's position as the dominant public transit card here as well as the strong small and medium-sized enterprise (SME) representation by the other three players.

The SME segment has often been described as a key under-served segment that the upcoming digital banks will be targeting. These smaller enterprises, especially micro-enterprises and startups, tend to face more difficulty managing their finances and securing funding from traditional banks.

Temasek's Heliconia invests in "growth-oriented" SMEs in the region, with big names such as hardware gaming firm Razer and mixed martial arts company One Championship.

It seems Temasek is backing multiple horses in the digital banking race - its venture capital arm Vertex Venture Holdings and Vertex-backed peer-to-peer lender Validus Capital are also said to be in the running for a separate digital bank licence bid together with OCBC Bank and Keppel.

Meanwhile, Far East Organization is a landlord to many SMEs across its properties, while V3 Group is known for housing various notable SME brands such as Osim, TWG Tea and Futuristic Store Fixtures.

A spokesperson for V3 said the group is committed to developing digital financial solutions for the underserved in the region, but declined to comment on specific plans. Far East Organization, Heliconia and EZ-Link declined to comment.

In line with this development, V3 Group announced on Thursday that it had set up a fintech unit back in October to pursue financial innovation opportunities in the region as well as develop digital financial services, focusing on SMEs and their workers.

To add gravitas to its fintech ambitions, the group pulled in ex-Temasek veteran and seasoned financial sector leader Gan Chee Yen as senior advisor to V3 Fintech.

Mr Gan is the immediate past CEO of Fullerton Financial Holdings, which invests in and operates financial institutions in emerging markets. Prior to that, he was co-chief investment officer, senior managing director, Special Projects, and head of the China market at Temasek International. He was also chief financial officer there.

V3 Fintech will identify and address gaps in the financial services sector, particularly those that affect SMEs and their workforce. It will also harness technology and data to work with businesses, families and individuals to enhance their financial well-being and improve financial inclusion in the region.

Mr Sim said: "As a business builder and employer, I understand the challenges faced by many SMEs and their workforce. With more innovative digital financial services made available to these drivers of our economy, they will be able to continue to strengthen their operations and improve stability."

Even as more consortiums mull a digital banking licence, there are just as many fintech players that have dropped out of the race. The latest include UK-based payments fintech Revolut and homegrown payments startup Nium, formerly known as Instarem.

Some of these firms have baulked at the minimum paid-up capital of S$1.5 billion for the digital full-bank licence to be met within three to five years of commencing business, with Revolut's chief executive Nikolay Storonsky telling BT earlier that it "did not make sense" for it to apply.