Razer has applied for a digital bank licence in Singapore, leading a group that encompasses an array of partners from various verticals to target the youth consumer segment. If successful in its bid, the games hardware maker says it will create a "global youth bank" to deliver its products and services.
Clearly banking on its brand reputation amongst youths and millennials, Razer said its fintech arm--Razer Fintech--met the objectives stipulated by the Monetary Authority of Singapore (MAS) by offering a "differentiated strategy and value proposition" that targeted the needs of underserved youths and millennials in the city-state.
Singapore in June unveiled plans to issue up to five digital bank licenses as part of efforts to add market diversity and boost the local banking system. MAS said this would include two digital full bank licenses, allowing licensees to offer financial services and take deposits from retail customers, and up to three digital wholesale bank licenses, which would enable licensees to serve SMBs (small and midsize businesses) and other non-retail segments.
The industry regulator said digital full bank applicants would have to meet three key criteria including a track record in operating an existing business, in their respective technology or e-commerce fields, and a value proposition detailing how it could serve existing unmet or underserved needs.
Detailing its plans in a statement Thursday, Razer Fintech said its youth bank aimed to tap its data technology stack as well as knowledge of the youth segment to develop customised products and services for these customers.
To be based out of Singapore, the Razer Youth Bank would be majority owned by Razer Fintech--with a 60% stake--while the remaining shares would be held by a group of partners that included insurance investment group Pacific Century Group, automotive online marketplace Carro, and Sheng Siong Holdings, a firm privately owned by Singaporean entrepreneurs--the Lim brothers-- behind local supermarket chain Sheng Siong Group. The retail group, however, had clarified that it was not directly involved in the Razer partnership, which was a personal endeavour of the Lim brothers.
Another network of partners would be roped in to develop products and services that would be offered by Razer Youth Bank. These companies included co-working space operator JustCo, travel platform SkyScanner, digital wealth management services provider Quantifeed, and Visa.
Razer Youth Bank also would look to support entrepreneurs and small and micro businesses that had limited access to capital, by using "innovative credit-scoring methodologies".
Razer Fintech CEO and Chief Strategy Officer Lee Li Meng said: "Addressing the unmet financial needs of the large, yet underserved, segment of the population though an innovative digital-first banking platform is a natural extension of our payments business."
Lee added that the company, over the past year, had been preparing for its bid in Singapore's digital banking era with the appointment of board advisors, and building partnerships with global financial services companies such as Visa as well as other partners in the ecosystem.
Razer said it would provide more details on the consortium "in due course" and subject to the success of its bid for a digital bank licence.
MAS is expected to announce the list of digital banking licensees in mid-2020.
Grab and Singtel last week said they were teaming up to bid for a digital bank licence in Singapore, where the ride-sharing operator and telco would be looking to target "digital-first" consumers and SMBs. The two partners would establish a joint entity to be 60% owned by Grab.
Razer in May 2018 inked a partnership with Singtel that aimed to plug current gaps in e-payment services, particularly in Southeast Asia, as well as tap growing opportunities in e-sports and digital media. The alliance was touted to ensure e-payments systems of both companies would interoperate and enable their respective customers to pay for the other's services using these payment modes.
Grab, Singtel partner up in bid for Singapore digital bank licence
Ride-sharing operator and telco plan to form a joint entity, with Grab owning a 60% share, and apply for a digital bank licence in Singapore, where they will look to target "digital-first" consumers and small and midsize businesses.
Singapore digital banking era will put focus on SMBs, consumer trust
Introduction of digital banks will 'shake up' Singapore's banking industry, which is expected to have up to five new digital market entrants, says a Forrester analyst, who underscores a need to build consumer trust and for small businesses to be better served.
Singapore to issue digital bank licenses
Move to issue up to five new digital bank licenses will add market diversity and boost the local banking system in Singapore's bid to become a digital economy, says industry regulator, which will begin reviewing applicants in August.
Singapore eases approval process for fintech trials, unveils cybersecurity rules
Monetary Authority of Singapore launches an "express" 21-day route to approval for fintech companies applying to test products in a sandbox environment, and mandates measures aimed at improving cybersecurity posture of financial firms.
Singapore banks offered $21M in funds to boost cybersecurity capabilities
Monetary Authority of Singapore is dishing out S$30 million (US$21.88 million) in a new grant to help local financial institutions boost their cybersecurity operations and skillsets, funding up to half of such expenses.