Carro Co-Founder and Chief Executive Aaron Tan said:
“The digital bank license will allow us to create differentiated products and more importantly help serve underserved SMEs. We think that the incumbent banks are doing a great job serving the segments of the market but we are mostly interested in being a platform that enables the SMEs."
The startup, which is backed by SoftBank Ventures Asia, EDBI and B Capital, currently offers loans and insurance services to car dealers and buyers through its wholly owned subsidiary Genie Financial Services. Genie claims to have underwritten loans worth over $200 million and facilitated more than 20,000 transactions in its two years of operations.
Tan said Carro is currently in talks with potential partners to apply for a wholesale digital banking licence. The Monetary Authority of Singapore, the city-state’s central bank, had in July announced that it plans to grant two digital full-bank licences and three digital wholesale banking licences. Applications are due by the end of December. MAS requires companies applying for a digital wholesale banking licence to at least have a minimum $73.69 million in paid-up capital. “[Financial services] continues to be core to our business and in the long run (as it has proven historically), it will play a bigger and bigger role in the profitability of the company,” Tan said.
Several companies are vying for a digital banking licence in Singapore. GrabPay, the financial services arm of Southeast Asia’s ride-hailing giant Grab, is one of them. “We are studying it very carefully and licences will only be issued […] I believe in May next year. So we will have to see what happens,” GrabPay Managing Director Reuben Lai told reporters on the sidelines of the Indonesian Banking Expo event in Jakarta. Lai said the firm’s interest in digital banking was prompted by GrabPay’s mandate of enabling access to financial services for its consumers.
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