Following this announcement, the USD 150 million Venture Debt offering in Singapore and the USD 1 billion ASEAN Growth Fund are aimed at the process of scaling high-growth companies, firms, and digital platform businesses respectively. In addition, complements the existing USD 200 million New Economy Fund also launched, which aims to optimise the manner in which early-stage startups develop in an ever-evolving economy.
The high-growth companies in the region of Singapore that are currently backed by venture capital or private equity investors will have the possibility to access HBCS’s Venture Debt capability in order to benefit from flexible funding arrangements and accelerate their development.
At the same time, the new Venture Debt offering was designed in order to provide a longer-term and flexible financial service to firms and companies. This process is expected to support the range of funding requirements such as capital expenditure, working capital, and runway extension for up to three years in tenor. Through the use of HSBC Venture Debt, new economy users and customers will be enabled to gain access to more specialised financial structures, including the ones that involve equity warrant instruments and tools.
In addition, the Singapore-based digital platform businesses that support ecommerce development in the region will be enabled to tap into the new launch of HSBC’s ASEAN Growth Fund. This process will take place in order to achieve economies of scale across several international markets, advance along the corporate lifecycle, and grow their overall asset portfolio.
New economy businesses operating in markets will be allowed to access HSBC SmartServe (designed to make the process of opening business accounts quicker and easier by securely navigating local regulatory requirements), HSBC TradePay (developed for trade loans in order to enable companies to concurrently draw funding and make near real-time supplier transactions with just a payment instruction files), as well as the HSBC Omni Collect (designed to improve the manner in which businesses remove the cost and complexity surrounding the set-up of their payment infrastructure, as well as allowing kiosks and ecommerce sites to access multiple popular payment methods).
The HSBC ASEAN Growth Fund was announced across six key markets, Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam. The USD 1 billion fund is expected to provide funding to digital platform companies in order for them to scale up and expand across the area. In addition, the investment will focus on optimising the region’s digital platform players to achieve economies of scale and develop their asset portfolios.
The HSBC ASEAN Growth Fund is expected to provide lending capabilities to companies that are scaling up through digital platforms, while also accelerating the development of new-economy names, more established corporates, as well as non-bank financial institutions. This process will take place by assessing operating metrics tied to their cashflow-generative asset portfolio, rather than choosing to rely on traditional financial products.
Both Venture Debt and ASEAN Growth Fund are currently complementing the already existing USD 200 million New Economy Fund, which was launched in order to meet the working capital needs of easy-stage startups in the region of Singapore. In addition, it is expected to develop a comprehensive and secure suite of financial solutions for new economy customers across different stages of their growth.
Besides extending its financial solutions to companies, HSBC Singapore is committed to optimise the development process of the startup ecosystem, as well as investors’ transaction banking and funding needs. The financial institution will also continue to expand the network of new economy businesses and work with partners in order to connect them to opportunities through knowledge exchange and networking. HSBC Singapore will also scale up its digital transaction banking offerings to meet firms’ regional expansion needs.
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