Boost — closing the credit gap for small businesses

GEORGE TOWN, July 12 — What started off as an eWallet company providing alternative methods for making digital payments back in 2017, Boost has now evolved into a regional full-spectrum fintech player that caters to the unserved and underserved segments, particularly micro, small and medium enterprises (MSMEs).

Boost’s group chief executive officer (CEO) Sheyantha Abeykoon said: “Since starting our journey five years ago as an eWallet pioneering QR code payments and encouraging Malaysians to embrace going cashless, we have expanded our core business spanning micro-financing, micro-insurance, cross-border content services and merchant solutions that ease the process of business digitalisation. We grew these businesses separately over the last four years and we unified them under one umbrella about one and a half years ago.

“Today, Boost is a full spectrum fintech player in Southeast Asia with five different entities namely Boost Life, Boost Biz, Boost Credit, Boost Connect and Boost Indonesia, making us one of the few fintech companies to offer solutions for consumer payment, merchant services, lending for small businesses and we also have remittance services for enterprises,” he said in an interview with Bernama.

With Bank Negara Malaysia naming the Boost and RHB Banking Group consortium as one of the five recipients of the digital bank licences, Sheyantha said this would certainly bring the company closer to its bigger ambition in the banking segment.

Serving the underserved

Sheyantha said Boost has established deep relationships with MSMEs on the basis of trust, where Boost was able to provide them with alternative financing through their transaction data with Boost. This data-driven approach is used to pre-score these businesses’ finances and grant them a loan facility without requiring any bank statement.

“We were able to help many merchants, especially those who do not qualify for financing from banks. We have disbursed almost RM1 billion worth of loans in the past four years and a major chunk of that was done in the last 24 months.

“More than 40 per cent of these merchants are new to credit, which means that they have never taken a loan before we made them an offer. A lot of people are talking about financial inclusion, but these MSMEs are always left out,” he said.

He is confident that Boost can help these merchants to stay afloat especially during the pandemic because the company’s non-performing loan remained low at two to three per cent currently.

On the loan size per merchant, he said the average ticket size is about RM20,000 but Boost is able to go as small as needed.

“We have given loans as low as RM1,000 before. We are able to do that because we are a digital platform,” he said.

Helping MSMEs make that digital leap

Boost Biz CEO Eric Chong said the Covid-19 pandemic has greatly affected how businesses operate and most importantly, it has sped up the world’s digital transformation.

“During the pandemic, we launched a feature called Boost Payment Link, which allows merchants to collect a specific payment amount from the customer via sharing a link that can be sent through SMS or Whatsapp.

“We have also worked with the Malaysia Digital Economy Corporation (MDEC) to help merchants transition from offline to online. In 2020-2021, we onboarded about 45,000 merchants comprising MSMEs and over 5,000 of that figure are merchants from Penang.

“We also signed a memorandum of understanding with Majlis Bandaraya Seberang Perai (MBSP) in September 2021 so that merchants do not have to queue to pay their stall rentals, parking compounds and even conveniently make payments to MBSP for tax assessment through our platform,” he said.

He said Boost Biz is making good progress with close to 500,000 merchant touchpoints nationwide, where more than 35,000 of those merchant touchpoints are in Penang.

Chong said the company is also working with big partners like 62-year-old Penang retailer Sunshine Wholesale Mart Sdn Bhd, where on top of offering payment solutions for shoppers at their stores, it is also streamlining Sunshine’s staff allowances.

Businesses accept Boost as their trusted digital partner

Sunshine CEO Cynthia Hwang said its partnership with Boost has enabled the company to pay their staff monthly cost-of-living adjustment (COLA) of RM250 to spend at all Sunshine outlets through the Boost app. Previously, this was done manually through physical vouchers that required extra paperwork for the human resource (HR) department.

“This results in a seamless experience for our HR department,” she added.

Meanwhile, the famous and oldest nasi kandar restaurant in the country Hameediyah has also embraced digitalisation and sees its benefits by accepting Boost.

Its operations director Muhammad Riyaaz Syed Ibrahim said he did extensive research on the digitalisation trend once it became a phenomenon as well as how to ensure the 115-year-old eatery continues to grow.

“I approached the top management on this, saying that we cannot continue with the old ways of cash payments. That is when the decision to partner with Boost came about.

“Boost has helped our business a lot, especially since a lot of our customers prefer to go cashless now,” he added.

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