Nova Founders Capital-backed CompareAsiaGroup, a leading online financial marketplace in this region, is set to land a $25-million equity infusion from the International Finance Corporation (IFC) as the World Bank Group’s private venture lending arm looks to bridge the gap in financial services.
Founded in July 2013, CompareAsiaGroup operates in seven markets, including Hong Kong, Singapore, Taiwan, Thailand, Philippines, Indonesia and Malaysia. The Hong Kong-based firm will soon launch its Vietnam-based service at MoneyHero.com.vn.
CompareAsiaGroup has prestigious backers including Goldman Sachs, ACE & Company, Jardine Pacific and Route66 Ventures, along with Nova Founders Capital.
CompareAsiaGroup is raising funds to boost brand recognition, fuel regional expansion and invest further into its technology platform, according to a disclosure by IFC, which is looking at financing the platform to the extent of $25 million.
“The project (the proposed investment in CompareAsiaGroup) aligns with IFC’s contribution to the World Bank Group goals by addressing access gaps to financial services through the use of financial technology,” the IFC said, in the filing.
CompareAsiaGroup leverages technology to increase transparency of pricing and improve efficiencies in distributing financial services to the end consumers, seeking loans, credit cards and insurance.
“The company’s service will not only improve financial literacy to a broader audience but will also contribute to lowering cost of financial services and products in the market by increasing competitive pressure in the sector and help to increase consumption of financial services,” the IFC disclosure added.
Hong Kong is CompareAsia Group’s primary market even as it expects the revenue contribution to be diversified across the current seven territories going forward.
By 2020, majority of its revenue is expected to be generated from the emerging markets including Indonesia, Philippines and Thailand, which hold tremendous potential for financial services comparison for consumers, according to the IFC.
The IFC, a prominent investor in the financial sector in emerging markets, has been traditionally financing private banks to help them extend loans to small businesses. With the rise of technology as a catalyst for any industry to grow, the IFC is looking at investments in the technology sector, especially in Southeast Asia, a market of around 600 million people.
“A crucial part of the ecosystem is financial inclusion. Today you have technologies to solve and simplify transaction problems, to reach a remote village where there may not be a bank branch. The financial inclusion space is going to be very positive thanks to the technologies that are coming in,” the IFC’s head for East Asia Pacific Vivek Pathak had told DEALSTREETASIA in earlier interaction.
He said disruptive technology was an important area for IFC as a lot of innovation was happening across ASEAN. The investor has committed a $200 million fund for emerging regions in Asia.