01Fintech, a growth stage private equity firm specialising in financial technology across Southeast Asia, has announced a significant $20m investment in Validus.
The investment into the leading SME supply-chain financing platform operating in Indonesia, Singapore, Thailand, and Vietnam, is set to accelerate its its expansion in high-growth markets like Indonesia, bolstering technological innovations, and cementing its position as the leading market player in supply chain financing.
The firm, which already enjoys support from renowned investors like Vertex Ventures Southeast Asia and India, Vertex Growth, FMO, along with major East Asian financial institutions such as NorinChukin Bank and NongHyup Financial Group, focuses on driving financial inclusion and prosperity for small businesses.
It achieves this by utilising proprietary data and AI to facilitate growth financing for the underserved SME sector. Their efforts aim to provide faster, seamless financial solutions, enhancing SME productivity and cost savings.
Southeast Asia presents a vast $490bn SME financing gap for digital lenders equipped with robust credit assessment capabilities.
According to the Asian Development Bank, MSMEs account for 97% of regional enterprises, employing 69% of the labour force and contributing significantly to 42% of the GDP. Despite this, many SMEs lack sufficient credit access for their daily working capital needs, with over 60% facing challenges in securing loans.
Validus aims to bridge this gap by focusing on the unmet financing needs of SMEs, aligning with 01Fintech’s vision of enhancing financial inclusion for under-banked and underserved communities.
Kenny Man, Managing Partner of 01Fintech, said, “We are extremely excited to partner with Validus on their exciting growth journey. Their innovative data-driven approach, strong credit assessment capabilities, and continuous learning technologies which automate the assessment process has proven to be a game-changer and acknowledged by the industry through its multiple awards. Validus has a unique strategic ecosystem partnership model with brand owners, conglomerates, and public companies across Southeast Asia, which enables them to better serve the upstream SME suppliers and downstream buyers.
“These partners provide critical proprietary supply chain data to Validus, which will continuously improve its risk underwriting models and algorithms, a unique strength that other similar companies do not have. By leveraging their existing approach to supply chain financing, we believe Validus can further tap into the merchant bases of other platforms and provide supply chain financing in a seamless, automated way. This investment reflects our conviction in the team’s capabilities and passion to address a huge pain point facing SMEs in Southeast Asia and its vision to be the number one supply chain financing service provider in the region,” he continued.
Nikhilesh Goel, Co-founder and Group CEO, Validus, stated, “This investment by 01Fintech is a significant milestone for us. We are excited about the opportunities this partnership will unlock for us. With the support of 01Fintech, we aim to cement our leadership as the number one digital SME financing company in the region. We will be able to tap into their expertise and vast network in the region.
“The in-depth due diligence 01Fintech has done has shown their deep domain expertise and willingness to identify areas of growth to bring the company to the next level. We continue to stay focused on our mission of providing more accessible financial products and services to SMEs across Southeast Asia, and look forward to a successful collaboration that will continue to drive innovation in supply chain financing,” he explained
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