HSBC allocates $1 billion to scale up digital platform businesses in ASEAN

March 28, 2024 | 16:48
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HSBC has announced a $1 billion ASEAN Growth Fund to help scale up platform players in the region’s booming digital economy.
HSBC allocates $1 billion to scale up digital platform businesses in ASEAN

Southeast Asia’s digital economy is among the world’s fastest-growing, worth $218 billion in 2023 and expected to reach $600 billion by the end of the decade, at a compound annual growth rate of 16 per cent.

To help the region’s digital platform players achieve economies of scale, grow their asset portfolios, and advance along the corporate lifecycle, HSBC is announcing a unique, dedicated lending fund worth $1 billion.

“Like so many other internationally minded businesses, we are excited about ASEAN’s booming digital economy,” said Amanda Murphy, head of Commercial Banking for South and Southeast Asia at HSBC. “With a working population that is digitally native, increasing in size, and poised to consume more goods and services - especially on e-commerce - ASEAN has so much potential for growth. We are delighted to launch our first-of-its-kind ASEAN Growth Fund and work with digital companies as they expand in the region and beyond.”

The HSBC ASEAN Growth Fund provides lending to companies that are scaling up through digital platforms across Southeast Asia. It supports new-economy names, more established corporates, and non-bank financial institutions by assessing operating metrics tied to their cashflow-generative asset portfolio, rather than relying solely on traditional financial metrics.

In ASEAN, Vietnam was the fastest growing digital economy in 2022 and 2023, and is expected to maintain this position until 2025, currently led by e-commerce, online tourism, and online media. With the forecast of smartphone users reaching 67.3 million by 2026, accounting for 96.9 per cent of internet users, Vietnam has become a rosy market for the digital industry and both local and international players.

“ASEAN trade and foreign direct investment (FDI) have been an integral part of the Vietnam success story, and looking to the future, I am excited by the emerging opportunities it presents for the economy,” shared Ahmed Yeganeh, head of Wholesale Banking at HSBC Vietnam.

“The statistics and momentum spell out the size of the opportunity and I am impressed by the growing trade and FDI flows between Vietnam and other ASEAN markets. Particularly relevant for Vietnam is the growing digital economy, which, coupled with Vietnam’s consumption market, will make the digital economy one of the key pillars for Vietnam’s growth story. At HSBC I believe we play a key role in facilitating and contributing to the development of businesses in capturing these opportunities through our deep understanding and history in the region and our capability to connect customers to these opportunities through our global network and services.”

HSBC recently surveyed 600 companies operating in Southeast Asia and found that “digitalising operations” is the top business priority, selected by 42 per cent of the respondents. This is followed by “growth in Southeast Asia” (40 per cent), and “research and development” (37 per cent).

To help capture growth in the booming digital economy, nearly 65 per cent plan to increase their investments in the digitalisation of their businesses, second only to “expanding into new markets within Southeast Asia” (66 per cent).

HSBC is at the forefront of driving digital transformation in ASEAN, offering a range of digital transaction banking solutions such as Omni Collect, enabling clients more time to focus on business priorities and development in the region.

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