Validus Vietnam, a unit of Southeast Asia’s SME growth financing platform Validus, conglomerate TTC Group (TTC), and domestic early-stage investor Do Ventures have announced a joint venture to drive financial inclusion and tap the underserved SMEs in Vietnam.
The JV creates multiple synergies – one of which is TTC’s large ecosystem of SMEs across the energy, real estate, cane sugar, and hospitality industries in Vietnam, according to an announcement.
TTC Group has participated in the JV through its group company DHA Corporation (DHAC), which invests in real estate, health, and sports.
The JV also leverages Do Ventures’ deep expertise in the emerging fintech landscape in Vietnam that will be a strong support for Validus Vietnam’s growth ambitions. The JV will benefit from potential synergies with portfolio companies under Do Ventures in future.
“As Validus Vietnam scales to the next phase of growth, this JV reaffirms our mission to drive financial inclusion and increase SMEs’ access to affordable credit,” said Validus co-founder and Group CEO Nikhilesh Goel.
“The pandemic has accelerated the digital transformation of SMEs in Vietnam, and there is a large opportunity for fintechs to create meaningful and lasting impact through partnerships and technology,” said Vy Le, General Partner of Do Ventures.
Founded in 2015 to address the unmet financing needs of SMEs, Validus is one of Southeast Asia’s leading SME digital financing platforms.
In 2019, Validus expanded its operations to Vietnam with the backing of local asset management firm VinaCapital.
Since its launch in 2015, Validus has disbursed over $1 billion in SME loans across Singapore, Vietnam, Indonesia and Thailand. The company is backed by FMO, Vertex Growth, Vertex Ventures Southeast Asia and India, AddVentures by SCG, K3 Ventures, Openspace Ventures and VinaCapital Ventures.
SMEs continue to play a major role in Vietnam, accounting for 95% of all enterprises. However, access to credit remains a pressing issue for SME development in Vietnam, with the financing gap at 12% of GDP.
According to a World Bank Survey on the impact of Covid-19 on firms in Vietnam, about 50% of firms have under three months of cash flow, and over 60 per cent of firms have reported some difficulties with access to finance.