by Fintech News Singapore
March 27, 2024
HSBC has earmarked US$150 million for its venture debt offering that is aimed at scaling high-growth companies in Singapore.
Through this initiative, high-growth, venture capital or private equity-backed companies in Singapore will have access to flexible funding arrangements to fuel their expansion efforts.
This newly launched Venture Debt programme by HSBC is set to offer a more adaptable and long-term financing solution for a variety of funding needs, including capital expenditure, extending operational runway, and supplementing working capital for durations up to three years.
This venture debt offering is further enhanced by the inclusion of specialised financing structures, such as equity warrant instruments, tailored specifically for new economy companies.
In addition to the Venture Debt programme, HSBC had also launched its ASEAN Growth Fund that targets six of the region’s most rapidly developing countries, aiming to enhance the capabilities of digital platform enterprises.
These two initiatives complement HSBC’s existing US$200 million New Economy Fund, introduced in 2021 to support the working capital requirements of early-stage startups in Singapore.
Together, these funding solutions offer a holistic suite of financial services catering to the diverse needs of new economy businesses at various stages of their development.
HSBC Singapore has also established a dedicated team to assist investors in meeting their transaction banking and funding requirements.
Additionally, HSBC is set to enhance its digital transaction banking offerings to assist businesses in their regional expansion endeavors, with a recent survey indicating a strong inclination among Singapore-based firms towards ASEAN market expansion and further digitalisation of their operations in 2024.
Key digital solutions provided by HSBC to support the regional operations of Singapore’s new economy businesses include HSBC SmartServe, HSBC TradePay, and HSBC Omni Collect. These platforms aim to streamline business account openings, facilitate trade loans, and simplify the digital payment infrastructure setup, respectively.
Priya Kini
Priya Kini, Head of Commercial Banking, HSBC Singapore said,
“A common pain point we hear from startups is finding the right financing partner that understands their needs and can support them throughout their growth trajectory – from access to knowledge to skills and funding to strategic partnerships and network for their global expansion.
We know that profitability may not always reflect a company’s potential in its early stages. That is why we take a long-term view of potential growth by evaluating companies based on historical portfolio performance, key operating metrics, growth plans and customer acquisition strategies.”