Singapore’s big lenders tend to dominate banking for small and medium-sized enterprises in Asia, and this year is no exception, with UOB beating its domestic rivals to this award.
UOB has long been a powerhouse in SME banking, delivering high-end services to corporates not just in Singapore but across southeast Asia. A key area of growth in recent years has been delivering a full range of services, from transaction banking to payments and treasury, to fast-growing mainland Chinese corporates with ambitions in the Association of southeast Asian Nations (Asean) region.
In 2023, UOB’s SME segment saw total income rise 17% year on year, with net profit up 13%, and its return on risk-weighted assets improve by 12%. Of clear benefit to the lender was its decision to buy Citi’s consumer operations in Indonesia, Malaysia, Thailand and Vietnam, acquiring in each of those markets the US bank’s local unsecured and secured lending portfolios, plus its wealth management and retail banking deposits. The last of the deals, for Citi’s Indonesia consumer business, closed successfully in November 2023.
This deal matters because a lot of the clients UOB acquired are exactly the kind it covets in southeast Asia: fast-growing merchants who want to be served by sophisticated lenders capable of delivering a full suite of financial services.
At the end of 2023, UOB banked around 300,000 SME customers across the Asean region; its client base grew 5% year on year by number during the awards period. SME banking today comprises a quarter of its gross annual revenues.
The total outstanding value of the lender’s sustainability financing portfolio was worth S$44.5 billion ($29.6 billion) at the end of 2023, marking a year-on-year growth of 77% – surpassing its 2025 target of S$30 billion more than a year ahead of schedule. The bank’s sustainable financing portfolio relating to SME trade and loans was worth S$6.1 billion, also up 77%.
During the awards period, UOB introduced a range of new or improved services for SMEs. The bank’s Sustainability Compass platform helps corporates to overcome barriers as they embark on their sustainability journey. By the end of November 2023, UOB had onboarded more than 1,600 SMEs to the platform in Singapore and Malaysia, with Indonesia and Thailand to be added this year.
UOB has long been a powerhouse in SME banking, delivering high-end services to corporates not just in Singapore but across southeast Asia
“Whether you look at the number of SME clients or our market share, we are number-one in terms of SME banking in Singapore,” says Frederick Chin, UOB’s group head of wholesale banking and markets.
He adds: “We are gaining clients and market share in SME banking not just in Singapore, but across southeast Asia.
“The market perception has always been that we are an SME bank. We don’t mind owning that reputation though. We are diversified across banking, all the way from the biggest institutions down to micro-sized SMEs.”
The bank’s dedicated SME app now offers existing customers financing solutions such as approval-in-principle loans via a simple process that cuts the application time by more than 50%. First unveiled in Singapore in 2023, it is being progressively rolled out around the Asean region. The application also offers SME owners visibility on cash flow, account receivables and account payables via an interactive digital dashboard. Since its launch, the bank reckons 143,000 customers have downloaded the app, which had an average of 32,000 monthly visitors during the last quarter of 2023.
For larger SMEs ready to move into cross-border business, UOB Infinity’s financial supply chain management capabilities are now live in 10 Asian markets, including China, Singapore, Malaysia, Vietnam and Brunei. The solution allows digital interaction between sellers and buyers, with clients able to digitize supply-chain trade documents and access a full range of solutions, from procurement to payment, all on a single platform.
