PETALING JAYA: Malaysian businesses and travellers that deal with China’s cashless economy will soon be able to save up to 50% on foreign exchange costs and enjoy fast and secure cross-border, multi-currency transactions via the AP-1 digital card on their smartphones, offered by Singapore-based fintech Aleta Planet.

       Aleta Planet founder and group chairman Ryan Gwee said AP-1 allows foreigners to transact in and with China like a local, for big and small transactions.

       “AP-1 users do not need to set up a Chinese bank account. Our mission is very simple – to solve payment and remittance issues for millions of people and businesses that deal with China,” he told StarBiz at the recent launch of the group’s office in Kuala Lumpur.

       Launched in Singapore in December 2020, the AP-1 app is available on Apple Store, Google Play or Huawei App Gallery and the digital cards can be topped up via Visa and MasterCard credit cards.

       Set up in 2014 by former banker Gwee, Aleta Planet is among the first China-centric solutions in Singapore to pioneer cross-border business-to-business payments to China.

       Gwee said he set up Aleta Planet after 20 years in the banking sector in China, as he saw “foreigners and travellers in the country experiencing multiple issues on payments.”

       The group provides card issuance and merchant acquisition for card networks including UnionPay International, Discover, Diners Club, JCB, Visa and MasterCard.

       It is also WeChat Pay and PayNow enabled.

       Aleta Planet works with UnionPay International and WeChat Pay, and the group’s network enables individuals and businesses to deposit local currencies from 42 countries or remit funds to 141 countries.

       “In China, you will find that most people and businesses use Quick Response (QR) codes or contactless payments with their smartphones. Outside China, most places use point-of-sale terminals. But in China, today, most people don’t carry a physical card. So, on the consumer front, our AP-1 digital card provides a seamless transaction solution for both locals and foreigners in China,” explained Gwee.

       Huawei phone users can also make contactless cash withdrawals at automated teller machines of supported banks in China using AP-1 in Huawei Pay, making Aleta Planet the first issuer in the country to support this function.

       The AP-1 card can also be linked to PayPal accounts for added convenience.

       On the business front, Gwee said the AP-1 digital card is targeted at small and medium-sized enterprises which typically deal with around RM300,000 per trade payment.

       The AP-1 Business Account provides a fully digital, all-in-one account for businesses to pay into or collect sales settlements.

       Users can make direct payments into Chinese suppliers’ commercial accounts within two business days.

       According to Gwee, another benefit for AP-1 users that the get to enjoy up to 50% savings on foreign exchange costs, as Aleta Planet uses a single exchange (local currency is swapped directly to the yuan) versus the double exchange rates from banks and money changers (where the local currency is changed into United States dollars before being swapped for the yuan).

       “With banks and money changers, you don’t get the spot rate. Whereas if you go to the UnionPay website, you will see a much more competitive rate,” explained Gwee, adding that another convenience offered by AP-1 is quick money remittance to China (up to US$5,000 or RM21,000) within 60 seconds.

       Gwee pointed out that Malaysian merchants would thus enjoy better sales margins from China travellers.

       He also noted that UnionPay is the largest card network in the world. Globally, UnionPay’s contactless payment is accepted at 29 million merchant POS terminals in 93 markets.

       The UnionPay QR Code payment is accepted at 31 million merchants in 45 countries and regions.

       Presently, while the AP-1 digital card can transact via Apple Pay and Huawei Pay, it is not supported by the Google Pay digital wallet platform.

       “Android phone users can install the AP-1 card app and transact via QR codes. In the future, we will develop an app for Android where users can also use the Near Field Communication function to transact, without signing on to Google Pay,” said Gwee.

       The fast-growing fintech group also has offices in Hong Kong, Dubai, Australia and Malaysia and plans to expand its footprint to the Philippines in April, followed by Africa in the near future.

       Regarding business funding and growth, Gwee said the group is currently not looking at capital markets despite its rapid expansion.

       “We’ve been growing organically and the group has been self-funded thus far.

       “This is our eighth year in business and we are already profitable, but we are open to other possibilities for the company to grow, not just organically,” he said.

       Going forward, with additional capital, Gwee said Aleta Planet may look at potential mergers and acquisitions.

       “Cardless and digital transactions are the way forward. With digital platforms, the cost to go to the market is much lower and you can scale much faster.”

       As for regulators’ approvals, Gwee said the group operates in strict compliance with local regulations.

       “We are approved by Bank Negara for merchant acquisition. We have also applied for an e-money issuance licence in Malaysia.”

       Regarding the potential for the group’s Malaysian unit, Gwee pointed out that “there is low hanging fruit” with more than 500,000 Huawei-pay enabled phone users in Malaysia.

       “We want to reach 500,000 individual consumers within the next 24 months. We are also looking at the merchant acquisition business in terms of hotels and the education sector,” he said.

       He also said the group’s cost of (customer) acquisition is low.

       “By integrating our payment platform into existing systems, we can rapidly expand our user base.

       “For example, in Singapore, there are 300,000 Huawei-pay enabled phone users. Sign-up rates since February 2022 have been encouraging.”

       According to Gwee, presently, there are around 600,000 AP-1 digital cards issued.

       “The growth has been very quick, especially as the business started operations in 2018. It took me a few years to set up the ecosystem.”

       Revenue-wise, Gwee said the group earns 1% from the transactions that pass through its systems.

       Gwee noted that the Malaysian market has strong potential, emphasising that the group recorded US$10mil (RM42mil) in revenue in the first year of operations in Singapore.

       “We are probably looking at similar numbers in Malaysia. I think the market here is bigger because of the population (size),” he said.

       In 2020, the group launched a remittance service on UnionPay’s MoneyExpress network for an estimated 380,000 Chinese working in Singapore to send money back to China.

       He added that once China eases its travel restrictions, Aleta Planet expects to see strong earnings growth as students and tourists from the world’s second-largest economy return to Malaysia.

       Gwee said another growth avenue is via co-branding with retailers and other businesses, which can tie-up with Aleta Planet to issue personal digital cards to their customers and scale up their loyalty programme.

       In 2020, Aleta Planet partnered with one-stop lifestyle app Nestia to allow its more-than 600,000 registered members to make both offline and online payments using an UnionPay digital card.

       “We also have a partnership with Lakala, which is China’s second-largest merchant acquirer. We also hope to collaborate with airlines for the issuance of co-branded cards,” he said.