Fatfish Group’s (ASX: FFG) subsidiary Smartfunding has officially launched its buy now pay later service into the South East Asia market.
The Singaporean central bank has licenced the Smartfunding platform, which has launched a BNPL financing program for corporations in the South East Asia region.
This BNPL service is now taking applications, which are then automatically process via Smartfunding’s proprietary online platform, which was developed primarily by Fatfish’s in-house venture builder team.
According to Fatfish which owns almost 80% of Smartfunding, the BNPL platform has several advantages from launching out of Singapore, which it claims is “undisputedly” the dominant financial hub in South East Asia.
However, by being regulated and headquartered out of Singapore, Smartfunding can attract businesses from other South East Asian economies as well as Singapore.
BNPL in South East Asia
According to Fatfish, the BNPL model is relatively new in South East Asia, despite the region having an estimated potential market-size of 655 million people.
Meanwhile, the IMD World Competitiveness Centre ranked Singapore as the “world’s most competitive economy” in 2019 and again in 2020.
Additionally, Global Finance has ranked Singapore as the sixth most advanced country in terms of digital competitiveness in 2020.
“The management of Fatfish believes that BNPL financing – a proven business model in Australia – will resonate well in markets such as Singapore and the rest of South East Asia, due to multiple factors,” Fatfish stated.
Growing BNPL exposure and market appeal
Fatfish anticipates demand for BNPL offerings will continue growing.
As such, the company noted it would focus its group resources into further developing its BNPL business and other complimentary fintech offerings.
This will make them the core Fatfish businesses that will receive priority management attention.
BNPL demand is predicted to expand in the small-to-medium business space as traditional banks and lenders tighten credits facilities, especially at a time when these businesses are “cash strapped”.
Additionally, investors are looking for alternative investments such as BNPL to maximise returns during the current low interest rate environment.
Fatfish pointed out Smartfunding’s automated digital process is also appealing for small-to-medium businesses and investors, which has been accelerated by the COVID-19 pandemic.
The efficiency of these technologies is also expected to improve transparency across the value chain which is beneficial to all stakeholders.
BNPL focus prompts share price rally
Shoring up Fatfish’s decision to focus on BNPL and related fintech is a strong rally in the company’s share price.
Investors have flocked to Fatfish, spurring the company’s share price to a high of $0.27 on Tuesday from a closing price of $0.032 at the start of February.