Atome Financial more than doubled net profit in 2021, revenue up 123%

Photo: Atome Financial website

Southeast Asian fintech company Atome Financial, which operates buy now, pay later (BNPL) platform Atome and digital lending platform Kredit Pintar, more than doubled its profit in the financial year ended Dec 31, 2021, according to regulatory filings.

Neuroncredit Pte, the Singapore-registered entity of Atome Financial, reported a net profit of $30.23 million in FY21, up 2.7 times from $11.38 million in the previous year, show its filings with the Accounting and Corporate Regulatory Authority (ACRA).

Atome Financial’s profit and loss statement

The company’s revenue jumped 123% to $192.6 million in 2021 on the back of a surge in financial guarantee fees earned by its Indonesia lending business. These fees represent the difference between the interest charged to borrowers and the funding cost to the financing partners.

Atome’s financial guarantee fees contributed $98 million to its FY21 revenue, while platform services—these include conducting credit due diligence, matching borrowers with lending capital providers and loan collection services—stood at $53.46 million.

Meanwhile, its revenue from merchants, or the fee paid by merchants per transaction on Atome’s platform, came in at $8.46 million.

Atome Financial’s revenue from different services in FY21

Indonesia contributed nearly $185 million, or 95% of Atome Financial’s FY21 revenue, followed by Singapore ($5 million). Meanwhile, the contribution from the Philippines and Vietnam dwindled.

Atome Financial subsidiary Kredit Pintar is a strategic partner of Indonesia’s Bank Jago, a digital bank backed by the country’s largest tech conglomerate GoTo. Advance Intelligence Group and GoTo have a common investor in private equity firm Northstar Group.

Revenue contribution from primary markets in FY21

Atome Financial had cash and cash equivalents of $35.1 million at the end of FY21, up from $28 million in FY20.

The company had not responded to DealStreetAsia queries at the time of publication.

Investments and alliances

In July 2021, the company and its parent Advance Intelligence Grup agreed to issue convertible notes worth $111.11 million to an undisclosed investor, according to its ACRA filing. It received $56 million in the second and final tranche of that transaction in June this year.

In October last year, the company announced a 10-year partnership with Standard Chartered, including an unspecified investment by the international lender. StanChart has committed to providing financing of $500 million to Atome Financial over the lifetime of the alliance.

In August this year, Atome Financial secured a $100 million debt facility from HSBC Singapore for its payments business across Asia.

It has also issued shares worth $65 million to its parent and ultimate holding company this year.

Fintech firms such as Atome Financial are seeking to tap the opportunity presented by the growth in digital financial services usage in Southeast Asia, which has further accelerated in the wake of the pandemic.

For instance, the digital lending market in the region could see a 50% increase in outstanding balance from $26 billion in 2020 to $39 billion in 2021, “led by a rebound in lending appetite and growth in usage of buy-now-pay-later services,” according to the e-Conomy SEA 2021 report by Google, Temasek and Bain.

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