HSBC has introduced a new growth fund worth US$1 billion to support platform players in the rapidly expanding digital economy across the region.
Giorgio Gamba, the CEO of HSBC Thailand, announced the Asean Growth Fund, piloted in the previous year, which will provide loans to companies leveraging digital platforms in Southeast Asia.
The digital economy in the region is experiencing substantial growth, currently valued at $218 billion and projected to reach $600 billion by the end of the decade, with a compound annual growth rate of 16%.
The fund’s objective is to facilitate growth for HSBC’s Asean customers. Loan evaluations through this fund will not be solely based on profit and loss but will center on business expansion opportunities and prospects for growth.
This fund will enable businesses to establish loan accounts in six Asean countries from one central location. For instance, accounts can be set up in six Asean countries from HSBC Thailand.
Krisda Phatchareon, head of wholesale banking at HSBC Thailand, mentioned that loan assessments will now prioritize evaluating business potential and the possibility of generating future cash flows, rather than focusing solely on profit and loss or debt-to-equity ratios.
The loans are designed to help customers expand their operations or serve as working capital, offering competitive interest rates. Loan sizes will vary from $25 million to $100 million per customer, with typical contract durations spanning 1-3 years.
A recent survey conducted by HSBC among 600 companies in Southeast Asia, each with a turnover of at least $150 million, revealed that 42% of them are inclined towards adopting more digitalization strategies.
Moreover, 40% of these companies are looking to expand within Southeast Asia, while 37% emphasize utilizing technology, particularly in research and development efforts.
To cater to the growth in the digital economy, the survey also found that 65% of respondents plan to increase their investments in digitalizing their businesses, ranking second only to expanding into new markets within Southeast Asia.
Recognizing the shift towards digital banking, HSBC aims to provide efficient digital transaction banking solutions such as TradePay, Omni Collect, and HSBC UniTransact, empowering clients to focus on their core business strategies and regional development.
READ MORE STORIES: https://bangkokone.news
