Fintech Jenfi targets small businesses that are underbanked…even in Singapore

Jeffrey Liu and Justin Louie, who worked together at the GuavaPass startup, started Jenfi in Singapore to offer to fund small and medium businesses in Southeast Asia.

According to TechCrunch, Jenfi is currently enrolled in YC’s accelerator program and has bagged US$ 1 million in an angel round of debt and equity. Moreover, the Jenfi platform already has 50 borrowers enrolled on it and has disbursed S$600,000 to these businesses.

“Even in a quite well-established market like Singapore … half of these companies are still underbanked, [and] they don’t have access to credit,” Liu said to TechCrunch in an interview. “We realized there was a big problem there.”

He’s onto something here. A joint report released in 2017 by the International Finance Corporation (IFC) and SME Finance Forum estimated that the global funding gap for formal micro, small and medium businesses in developing countries was US$5.2trn a year. Furthermore, the East Asia and Pacific region represented 58% of total global potential demand.

The lending model

Moreover, Jenfi has an unusual lending procedure. It advances money as usual to small businesses or helps them fund purchases via a virtual Jenfi Mastercard. What’s interesting is the type of expenditure – Jenfi is pushing for these businesses to adopt digital marketing – an investment that would help them to grow revenues and scale-up. Interestingly, Jenfi collects its loan payments not as periodic payments but as percentage collections from these revenues.

Further, “Part of the value-add is that we can help them be more effective in their alternative marketing channels…our goal is to be able to build a network,” Liu said in the interview. “Marketing growth is our initial product focus for this company.”

Moreover, Jenfi is also assisting these SMBs by putting them in touch with marketing agencies that can formulate and execute growth strategies for them.

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