SINGAPORE: Billionaire Jack Ma’s Ant Group Co has launched its digital bank in Singapore, as China’s largest online financial platform branches out of its home market amid regulatory headwinds.

       ANEXT Bank will provide digital financial services to micro, small and medium-sized enterprises that have cross-border operations, it said in a statement yesterday. Ant will allow these businesses to open an account from the third quarter of this year.

       The financial technology (fintech) giant is entering an arena dominated by traditional incumbents including DBS Group Holdings Ltd and Oversea-Chinese Banking Corp.

       Using Singapore as a base for its business in South-East Asia may offset slower growth prospects at home after government-ordered regulatory overhauls.

       “Continuous innovation and new capabilities that digital banks are slated to bring will no doubt add more engines of growth to Singapore’s financial sector,” Monetary Authority of Singapore (MAS) chief fintech officer Sopnendu Mohanty said in the statement. Ant, part-owned by Alibaba Group Holding Ltd, can also benefit from the eCommerce operator’s unit in South-East Asia, Lazada.

       Toh Su Mei, a former executive at DBS, will take the reins of Ant’s digital bank, the company said.

       Toh, who has more than 20 years of experience in the banking industry, led DBS’s lending arm for small and medium-sized enterprises in the region before joining the fintech giant, according to her LinkedIn profile.

       Ant’s digital bank, which received approval from the central bank to begin operations last Thursday, is starting by offering a preview of its dual-currency deposit account, which includes features including three-factor authentication verification, remote on-boarding and daily interest, it said.

       Ant’s wholesale license allows it to serve small and mid-sized firms and other non-retail segments, and requires a capital commitment of S$100mil (US$73mil or RM321mil).

       That compares with a full digital bank licence, which can serve all kinds of customers and eventually requires S$1.5bil (RM4.79bil) in capital as well as local control.

       Ant will also partner with Proxtera, a local entity that’s part of a public initiative led by MAS and Singapore’s Infocomm Media Development Authority, to create an open framework for collaboration with financial institutions.

       Singapore’s efforts to open up the banking industry to technology companies come on the heels of a similar move in Hong Kong, where Ant and Chinese competitors including Tencent Holdings Ltd obtained licences in 2020.

       Ant’s payments app Alipay had about a billion annual active users as of August 2020. The company has invested in 10 digital wallet operators outside China, including Paytm in India and Dana in Indonesia. — Bloomberg