Singapore’s banks lead the field in services for small and medium-sized enterprises that go beyond their home base into the surrounding countries: some of the very few cross-border SME businesses that can be found in the world.
In a tightly contested field, we reward OCBC for a year that brought impressive growth alongside innovation.
The combined markets within OCBC’s SME business saw total income grow by 24% in 2018 year on year, with the deposit balance up 11% and loans up 6%, all with a non-performing loan ratio of less than 1.75% – impressive for a business that necessarily requires risk.
More than half of Singapore’s SMEs bank with OCBC; over 40% of all newly incorporated small businesses choose to open their business banking accounts with it.
Elsewhere in the region, the bank has doubled its SME customer base in Hong Kong over the last year as the Wing Hang acquisition has bedded in, enjoyed 22% growth in its Indonesia business. It is also thriving in Malaysia.
OCBC was quick to realize the potential of digital transformation for the SME segment; in Singapore 62% of the bank’s SME customers are digitally active and they generate three times the revenue of a non-digital customer.
Regionally, 55% are digitally active, and digital transactions in that segment grew 10% last year.
New initiatives include an instant account opening service for small businesses on the Singapore national depository, MyInfo, allowing a new enterprise to open an account in minutes through the internet or via mobile. A digital know-your-client process has helped.
In Indonesia, the new OneMobile application is underway, and at home the PayNow Corporate platform, launched in August, allows SMEs to collect payments directly into their business accounts through a QR code. A new online loan application model was launched in March 2019, dramatically reducing documentation.
Similar time-saving initiatives are under way in trade financing, digital dashboards, and through dedicated teams to manage north Asian flows for Greater China corporates.