Swedes launch lending platform in Singapore, target Southeast Asia

Lendela, set up in 2018 in Singapore by founders from Sweden and global fintech group Zentro, forms proof of how Singapore is a preferred hub also for start-ups when it comes to entering the Southeast Asian market. And with the right business model local financing can, it appears, easily be obtained.

Lendela is in the business of connecting consumers with the best credit providers (normally banks), as a digital loan broker and finance platform.

Co-founders Shylendra A S Nathan (also CEO, fr. Malaysia and with long online business experience working for Scandinavian companies) and COO Nima Karimi (fr. Sweden, with extensive experience in Insurtech and Fintech) are steering the new fintech business, eyeing a gap in the Southeast Asian market they intend to fill.

“Southeast Asia has all the right conditions for this model to work and, although there are similar services, no one is doing the Nordic model that we are bringing here. We saw an opportunity in providing another model than what the competitors here are offering,” Nima Karimi explains.

Lendela speeds up the loan application process by allowing borrowers apply for a personal loan to multiple lenders through a single application. These (consumers and sometimes also companies) will then be able to view valid and relevant offers tailored to their specific demographic and financial situation.

In the Scandinavian region the founders have over 15 years of experience in helping connect consumers with the best credit providers. They have channelled millions of customers to over 25 well established banks and lenders in the region.

Prior to Lendela Nima worked at Zmarta where they built more services around private lending. However, by then Scandinavia, Sweden in particular, had become very competitive with this.

“As co-founders our team decided to bring the model to other countries, first to Brazil, and I took on to launch in Southeast Asia. When we came here in 2017 and did our pitch week we met many investors, all of them showing interest, so everything went smoothly. By March 2018 we had closed a deal and had the money in our bank account. I think this had to do with the fact that the benefits of the model are quite obvious and it’s easy to show a proven business model not only in the Nordics but in Brazil also; a by no means mature market. And there is hunger here for fintech,”

“Hand on heart; it would have been much easier for us to get funding in the Nordics, where everyone knows this market’s fintech successes. But we are focused on finding local investors because we know that even though we have this Nordic experience we need local expertise also to succeed,” emphasizes Nima.

“Why we chose Singapore is obvious; this is where fintech is hot. At the end of the day we are a consumer service and will not be satisfied to have Singapore as our main market, so we have our targets going beyond that.”

In Singapore Lendela launched August 2018 after partnering up with three banks, but have spent more effort on Malaysia and also Thailand recently.Singapore and Malaysia are strikingly similar in maturity, while the first has a more developed digital identity, which simplifies a lot the valuation process of a customer. In contrast, in Malaysia it is much easier to work together with credit agencies, thanks to regulations.

“I can say with 100 per cent certainty that there is no one in Singapore doing the model we offer where the customer comes to us, filling out our form and we collect the offers.What you have here is the aggregator or leads generator model where the customer’s basically gets a list of all banks available on the market, and if they are interested they must visit the respective bank site to apply.”

Lendela’s solution includes several parts: First, the sourcing of customers, where we find strategic partners who can provide us with leads. We then utilise technology to create a dynamic form that is customised to the individual. The second part is the credit scoring we add on, done partly by traditional credit scoring agencies in these markets but also some more innovative solutions. This gives us a more complete picture of an applicant’s financial situation. Due to our wider range of credit scoring capabilities we are usually able to give our partners more information about the applicant than their own internal scoring models.”

“Another part of our service which is important to highlight and that we are bringing with us from Sweden is re-financing. Customers come to us while they are still paying off these loans but we help them consolidate bad credit into one loan with better terms,” he adds.

“We look at the market demands and adapt. We can find clients in various ways, that’s our strength, as well as helping them through a very complicated and cumbersome loan application process. We do this while at the same time helping our partner banks get access to the right lenders for a fraction of what they usually spend on customer acquisition.”

In March 2019 Lendela will also launch its lending service for SMEs in both Malaysia and Thailand.

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