Business Loans

2023 Update on Digital Banks in Singapore

Jennifer Tjahyadi
March 21, 2023

Singapore digital banks have made waves in the financial sector by providing customers with a new banking experience that is both accessible and practical. The birth of digital banks in Singapore has completely changed the banking landscape, with the Monetary Authority of Singapore (MAS) issuing licences to four different digital banks in 2020:

  • GXS Bank, owned by Grab and Singtel
  • MariBank, owned by Sea
  • ANEXT, part of China’s Ant Group
  • Green Link Digital Bank (GLDB), held by a consortium involving Greenland Financial, Linklogis Hong Kong and Beijing Co-operative Equity Investment Fund Management

These banks offer a range of banking services, from virtual banking to digital wealth management, that are specifically tailored to the needs of the market. In this article, we will take a closer look at what digital banks in Singapore have been up to so far, and how they are transforming the banking landscape for small business owners.

Digital Banks for Business Owners

Ever since Covid, small businesses rely heavily on digital banking services that cater specifically to help them thrive in today's fast-paced digital economy. These banks offer a wide range of services, including fully digital business accounts, fast approval business loans, expense management features, and integration with other software platforms.

One of the key benefits of using digital banks for small businesses is the ability to access full digital banking services 100% online, without the need to visit a physical branch. These digital banking services usually. The most basic service offered in most digital banks are digital business accounts that are designed to offer businesses the flexibility and convenience they need to manage their finances on the go, with features like multi-currency support and online invoicing and payment processing.

In addition to business accounts, digital banks in Singapore also offer fast approval business loans. These loans can be processed quickly and efficiently, with minimal paperwork and a focus on providing businesses with the capital they need to grow and succeed. Some digital banks offer a lower interest rate compared to Working Capital Loans offered by banks. For example, ANEXT Bank for SMEs, the wholly owned subsidiary of the ANT Group, offers the ANEXT Business Loan with interest rates as low as 8.8% p.a. (EIR)

Expense management is another key area where digital banks excel the most. With features like automated expense management and invoice management, businesses are able to stay on top of their finances and manage their cash flow more effectively from anywhere. Most digital banks in Singapore also offer seamless integration with other software platforms, allowing businesses to consolidate all their financial processes and needs in one place. This integration can help businesses streamline their operations and improve their overall efficiency, saving them time and money in the process.

Also read: Benefits and challenges of using a Neobank account for businesses and whether it's worth ditching traditional business banking for a digital business banking.

Differences Between the Four Digital Banks

GXS, Green Link, ANEXT, and Maribank are all digital banks in Singapore that offer a range of financial services to both businesses and consumers. While they are all digital banks, each of them have their own unique features and offerings. One of the biggest differences between these digital banks is their area of specialisation. 

ANEXT offers a range of digital financial services to modern SMEs, like a current account and SME term loans and revolving loans of up to S$300,000.

Green Link Digital Bank is primarily focused on offering banking services to the environmentally conscious consumer with revenue greater than S$10 million, unlike ANEXT, which focuses on SMEs. They also offer a diverse range of products such as deposit accounts, overdrafts, payable and receivable financing, as well as receivable purchase financing.

GXS, on the other hand, has no SME lending or accounts yet. They are still primarily focusing on consumer products like consumer bank accounts for a selected group of customers.

Similarly, Maribank also has no SME solutions at this point in time. They offer personal banking services, including a Mari Savings Account with 2.5% interest, but only for employees of its parent company, Sea, and invite-only customers.

Differences Between the Digital Banks vs Other Banks

According to an article by The Business Times, the fantastic four digital banks have not changed the game as much as they had first claimed. They haven't had much of an impact on the market, and the typical consumer doesn't utilise them much.

Singapore wanted to avoid any market disruption from the beginning, so regulators mandated that digital banks present distinct value propositions. Also, they had to address Singapore's underserved market segments in addition to utilising cutting-edge technologies.

Moreover, in the past two years, most of the traditional banks have enhanced their digital offerings. Features such as digital business accounts and low-cost foreign exchange have become increasingly popular.

Future of Digital Banks in Singapore

Although we believe that the rise of digital banking in Singapore will raise standards for other conventional banks and neobanks in the market, there is no doubt that this is only the beginning. 

Digital banks will need to find and tap into their unique strengths and offerings to develop specific products to solve problems for the niche market. This could be done by continuously listening to their respective client base and building products which create value for them. That way, digital banks will be able to create a compelling and all-inclusive offering to differentiate themselves and attract the right group of clients.

Leading digital loan marketplace Lendingpot connects SMEs to its network of 45 lenders comprising relationship managers from banks, financial institutions, and private and peer-to-peer lenders in Singapore. It aims to help SMEs overcome the information asymmetry problem and lack of transparency prevalent in the SME financing sector by offering SMEs financing options such as business term loans, property loans, revenue-based financing, credit lines, working capital loans, bridging loans, invoice financing, and more.

About the author

Jennifer loves helping SMEs in their business growth journey. She is also an epicurean and has perpetual wanderlust. During the weekend, she weaves poems out of thin air and buries herself in books.

Digital Bank
Anext Bank
GXS Bank
Green Link Digital Bank

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