SingX is helping economies move towards a cashless system
Singapore-based online remittance startup SingX has raised US$4.5 million in a pre-Series A round led by senior bankers and high net worth individuals from Singapore and Hong Kong.
SingX will channel part of the funding to scale up customer acquisitions in Singapore, increase the number of payment corridors, and ramp up platform development.
The fintech company will also use the newly-raised financing to expand its services to Hong Kong, Malaysia and Australia, with Malaysia being a particular focus for the company.
“Currently, there are 350,000 Malaysians in Singapore who transfer money back home to pay mortgages, bills, family and other expenses. Many Malaysians presently use a very cumbersome and unsafe process of remitting money from Singapore to Malaysia,” read an official SingX press release.
“They first stand in line at a money changer to convert their Singapore dollars to Malaysian ringgit, and then physically carry this money into Malaysia and queue up a second time at a Malaysian bank to deposit money.” it added.
SingX, which is licensed by Singapore’s central bank Monetary Authority of Singapore (MAS), first launched its fund transfer service in India, in January this year. It is led by CEO and Co-founder, Atul Garg, who is a former American Express banker.
Like many digital remittance services, such as Ayannah and BitSpark, and Bitcoin-based platforms, such as Bitcoin and Toast, SingX’s value proposition to consumers is that it bypasses banks and therefore cheaper (and more intuitive).
Remittance via banks and other traditional financial institutions tend to incur high cable charges, commissions, and other FX conversion rates. SingX, however, offers a considerably lower exchange rate. For example, transferring money from Singapore to India via SingX incurs a 0.5 per cent transfer fee while banks normally charge at around 8 per cent.
A centralised digital platform also enables all pertinent information such as live exchange rates to be displayed transparently and instantaneously (bank transfers typically take up to three days). Consumers also do not need to travel to a bank branch to make transfers.
“The platform is faster because it disintermediates SWIFT and correspondent bank network, which takes one to three days to credit,” added Garg.
How SingX differs from the aforementioned remittance digital platforms, however, is that it targets white collar workers and SMEs as opposed to blue collar migrant workers.
This means SingX is going after a market segment who have more leverage and are savvier financially. They would also probably be more familiar with fintech apps and would, thus, be able to adopt this new solution without hitches (of course, the argument could be made that if SingX is in the business of making remittance more accessible, blue collar workers should not be left out since migrant workers make up a healthy bulk of all regional and global remittance transactions).
Garg said that since SingX has hit an annualised run rate of US$100 million.
Eventually, SingX aims to roll out a p2p foreign currency exchange platform, said Garg. “Over time, the P2P technology will eliminate the need to convert from one currency to another,” he said.
Image Credit: SingX
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