Southeast Asia’s leading award-winning Fintech Validus exceeds S$1 billion in SME lending
Validus, Southeast Asia’s leading award-winning SME growth financing platform, today announced that it had exceeded S$1 billion in disbursals of business financing to small and medium businesses across the region. This milestone comes as the SME Fintech lender enters its sixth year of operations. Amid the Covid-19 pandemic, Validus has consistently outperformed itself against previous months in revenue and loan disbursements. The company has seen record growth and recently reported its strongest quarter to date, with total loan disbursements exceeding S$150 million. At present, Validus is disbursing more than two times of pre-pandemic levels – its monthly loan volumes have grown 300% in the last 24 months. Its default rate remains under 1%, a testament to Validus’ partnership-driven model, data analytics, collaborative models, and sound risk management.
Founded in 2015 to drive inclusive growth for SMEs and local economies in the region, Validus connects growing SMEs to accredited and institutional investors for fast, secure, collateral-free financing. Its differentiator lies in its strong origination channels – partnership-led strategy and bank channels. It counts large corporations and government-linked companies such as ST Engineering, YTL PowerSeraya, and Siemens as partners to finance their supply chain relying on non-traditional data. This unique anchor-led customer acquisition strategy facilitates cross-selling. At present, Validus is live in three countries in Southeast Asia – Indonesia (Batumbu), Vietnam (Validus Vietnam), and Thailand (Siam Validus) – with much success, having already shown over 500% growth with close to zero default rates.
In a previous finding from Validus’ Economic Impact Report, over 300,000 Singaporeans had directly or indirectly benefited from Validus’ SME financing platform. SMEs that obtained financing from the platform experienced a 17 per cent increase in their annual revenue in 2018. GDP contribution from Validus-assisted SMEs grew by 18 per cent. In addition, SMEs who obtained financing from Validus experienced robust employment growth of 12 per cent as compared to 1 per cent of the overall employment growth of Singapore’s businesses.
As a testament to the strong track record and commitment to supporting the nation’s SMEs, Validus was approved as a Participating Financial Institution (PFI) under Enterprise Singapore’s Enterprise Financing Scheme alongside local banks and established financial institutions.
“While we have achieved a significant milestone, there is so much more we can do to drive access to affordable, collateral-free financing to enable the growth of small and medium businesses in Southeast Asia. While developing the origination and underwriting model, we were charting new paths and dealing with digital financing for digitally progressive SMEs. Our first $1 Billion took us five years. The next milestone of $2 Billion will take us only one year.” says co-founder and Group CEO Nikhilesh Goel. “By growing and strengthening existing partnerships, forging new ones, and building a genuinely differentiated fintech proposition, we will continue to grow our support for underserved SMEs in the region.”
According to the SME Finance Forum, the funding gap in Southeast Asia stands at an estimated $300 billion. SMEs account for nearly half of the total GDP of five ASEAN founding members, including Indonesia, Singapore, and Thailand. Financing will continue to play a crucial role in growth and recovery for SMEs as they transit in the post-Covid-19 era.
Headquartered in Singapore, Validus is also present in Indonesia (Batumbu), Vietnam (Validus Vietnam), and Thailand (Siam Validus). The firm has garnered several prestigious awards, most notably, the top prize at MAS FinTech Awards 2020 for the category for Singapore Financial Institution. There are also plans to explore further expansion across the region and digital plays, specifically digital banks in some markets in the near future.