Vietnam closes up to Singapore in fintech startup funding

Vietnam Closes Up To Singapore In Startup Fundingh

Vietnamese financial technology startups are quickly catching up to Singapore in attracting Southeast Asian venture capital funding, with Indonesia rounding out the region’s top three investment destinations, the Nikkei  Asian Review reported.

Vietnam’s slice of regional venture capital funding devoted to fintechs soared from just 0.4 per cent in 2018 to 36 per cent in the nine months to the end of September this year. Singapore attracted a 51-per cent share, down from 53 per cent in 2018, with Indonesia receiving 12 per cent, compared to 37 per cent last year.

Much of the venture funding in Vietnam is flowing into online and mobile payment technology, the report says.

Driven by double-digit annual growth, digital payments are expected to become the payment method of choice for nearly half of all transactions by 2025, surging past the $1-trillion mark as fintech companies tap the 300 million adults across Southeast Asia who either don’t have a bank account or lack proper access to credit, investment and insurance facilities.

Overall, after attracting just $35 million in venture capital funding in 2014, total investment in Southeast Asian fintechs has boomed over the past five years, reaching $679 million in 2018, with fintech funding in the region already reaching $1.14 billion this year.

Ranked in terms of ability to draw capital, Vietnam’s e-payment solutions provider VNPay came out on top in the FinTech in ASEAN report by the Singapore branch of consultancy PwC, with $300 million in disclosed funding deals this year. Insurance provider Singapore Life came in second with $110.3 million in deals and Vietnam’s MOMO Pay third with $100 million.

Multinational e-payments platform Akulaku was Indonesia’s top performer, tied in fifth spot with Singapore finance and accounting company Deskera with $40 million in funding deals. All top ten funded fintechs were located in either Singapore, Vietnam of Indonesia.

Thailand, Malaysia and the Philippines together accounted for less than two per cent of the region’s fintech funding, down sharply from around ten per cent in 2018, found the report, which attributed the bigger appetite for companies based in Vietnam and Indonesia to their large unbanked populations.

A key challenge faced by fintech firms in expanding across the region, the report said, was first finding talented employees and then being able to hold onto them. Of the 139 fintech companies surveyed, 58 per cent highlighted this as a concern, with a majority saying that hiring the right people took a long time.

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Vietnamese financial technology startups are quickly catching up to Singapore in attracting Southeast Asian venture capital funding, with Indonesia rounding out the region's top three investment destinations, the Nikkei  Asian Review reported. Vietnam's slice of regional venture capital funding devoted to fintechs soared from just 0.4 per cent in 2018 to 36 per cent in the nine months to the end of September this year. Singapore attracted a 51-per cent share, down from 53 per cent in 2018, with Indonesia receiving 12 per cent, compared to 37 per cent last year. Much of the venture funding in Vietnam is flowing...

Vietnam Closes Up To Singapore In Startup Fundingh

Vietnamese financial technology startups are quickly catching up to Singapore in attracting Southeast Asian venture capital funding, with Indonesia rounding out the region’s top three investment destinations, the Nikkei  Asian Review reported.

Vietnam’s slice of regional venture capital funding devoted to fintechs soared from just 0.4 per cent in 2018 to 36 per cent in the nine months to the end of September this year. Singapore attracted a 51-per cent share, down from 53 per cent in 2018, with Indonesia receiving 12 per cent, compared to 37 per cent last year.

Much of the venture funding in Vietnam is flowing into online and mobile payment technology, the report says.

Driven by double-digit annual growth, digital payments are expected to become the payment method of choice for nearly half of all transactions by 2025, surging past the $1-trillion mark as fintech companies tap the 300 million adults across Southeast Asia who either don’t have a bank account or lack proper access to credit, investment and insurance facilities.

Overall, after attracting just $35 million in venture capital funding in 2014, total investment in Southeast Asian fintechs has boomed over the past five years, reaching $679 million in 2018, with fintech funding in the region already reaching $1.14 billion this year.

Ranked in terms of ability to draw capital, Vietnam’s e-payment solutions provider VNPay came out on top in the FinTech in ASEAN report by the Singapore branch of consultancy PwC, with $300 million in disclosed funding deals this year. Insurance provider Singapore Life came in second with $110.3 million in deals and Vietnam’s MOMO Pay third with $100 million.

Multinational e-payments platform Akulaku was Indonesia’s top performer, tied in fifth spot with Singapore finance and accounting company Deskera with $40 million in funding deals. All top ten funded fintechs were located in either Singapore, Vietnam of Indonesia.

Thailand, Malaysia and the Philippines together accounted for less than two per cent of the region’s fintech funding, down sharply from around ten per cent in 2018, found the report, which attributed the bigger appetite for companies based in Vietnam and Indonesia to their large unbanked populations.

A key challenge faced by fintech firms in expanding across the region, the report said, was first finding talented employees and then being able to hold onto them. Of the 139 fintech companies surveyed, 58 per cent highlighted this as a concern, with a majority saying that hiring the right people took a long time.

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