SINGAPORE – Chinese financial technology giant Ant Group Co. launched a digital bank in Singapore on Monday that will serve small businesses in the city-state, extending the company’s reach beyond China.
Anext Bank, a Singapore-based subsidiary of Ant, has started operations and will provide digital financial services to micro, small and medium-sized enterprises, targeting those engaging in cross-border transactions.
Anext will use Ant’s technology and expertise to serve the SME community in Singapore and intend to work with incumbent banks in the country, Anext CEO Toh Su Mei said at a press conference.
“We are not here to compete, and definitely not to create a price war,” she added.
Ms Toh said that Anext could also facilitate its clients business contacts with China. The bank will launch a dual-currency deposit account for companies and plans to introduce other products in the future.
Sopnendu Mohanty, director of financial technology at the Monetary Authority of Singapore, said he expected Anext to implement the business models behind Ant’s “tremendous success” in China. He added that Anext has to comply with local laws and “know your customer” requirements and is expected to hire a large number of employees locally.
About 25% of Anext’s employees are located in mainland China, and the rest in Singapore, Toh said.
Headquartered in Hangzhou, China, Ant operates Alipay, a mobile payment application that is ubiquitous in the country, and also provides online loans and other financial services to many small and micro businesses.
Ant received one of two digital wholesale banking licenses from MAS, Singapore’s central bank, in December 2020. The other went to a consortium that includes units of Chinese developer Greenland Holdings Corp. and a specialist in supply chain financing, Linklogis Inc. Green Link Digital Bank of this consortium opened last week. MAS requires wholesale banks to have at least $ 100 million Singapore dollars ($ 72.7 million) in paid-up capital.
MAS has also licensed digital retail banking to a consortium of Grab Holdings Inc. and Singapore Telecommunications Ltd. and an entity belonging to Sea Ltd.