Digital banks in Singapore are revolutionising the way small and medium-sized enterprises (SMEs) access financing, addressing long-standing challenges such as limited credit access and inflexible financing options. GXS Bank, a key player in this transformation, recently acquired Validus Capital, a leading SME-focused digital lender, marking the first instance of a local digital bank acquiring a homegrown fintech firm.
SMEs constitute 99% of businesses and 70% of the workforce in Singapore, yet many face barriers that hinder their growth and cash flow management. Digital banks are stepping in to offer innovative financing solutions and digital tools that streamline operations, improve efficiency, and open new growth opportunities. This support is crucial as SMEs navigate rising operational costs and seek to compete globally.
The acquisition of Validus Capital by GXS Bank in April has significantly accelerated the bank’s market presence. Within just over 100 days, the rebranded GXS Capital has expanded its suite of digital business banking solutions and witnessed a notable increase in loan disbursements. Vishal Shah, Group Head of Business Banking at GXS Bank, highlights the importance of this acquisition in enhancing the bank’s ability to serve micro, small, and medium enterprises (MSMEs) with innovative lending and working capital solutions.
Digital banks like GXS are proving to be valuable partners to fintechs, bridging gaps in SME financing and supporting the sector’s growth. As the landscape continues to evolve, these institutions are poised to play a critical role in shaping the future of SME financing in Singapore.
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