Disrupting the telco: the Axiata edition

The Top Up is Tech in Asia’s free newsletter that breaks down the biggest stories and trends in fintech. [Read from your browser]( The Top Up 💵 Welcome to The Top Up! Delivered every Wednesday via email and through the Tech in Asia website, this free newsletter breaks down the biggest stories and trends in fintech. If you’re not a subscriber, get access by [registering here](. Written by Melissa Goh Journalist at Tech in Asia Hello {NAME} , It’s hard to change when you’re a large organization. Even when the need for change is clear, new ideas often face resistance for fear that they might disrupt one’s core business. Time and again, bureaucracy and a lack of agility can also slow down progress and be frustrating. But what if companies could find some sort of middle ground? Perhaps set up an innovative digital arm that’s led by new blood - one that operates at arm’s length from the main business? One such company comes to mind: True Digital Group, the innovation arm of Thailand telecommunications conglomerate True Corporation. It built a “content super app” called TrueID that rivals Netflix and Spotify in the country by focusing on local content. Spanning entertainment to merchant services and a full digital academy, its tech journey is not what you’d expect from a [century-old company](. Other telcos are now following a similar playbook. Boost Holdings, the fintech arm of Malaysia’s Axiata Digital, runs one of the largest and most actively used e-wallets in the country. It’s also rapidly expanded into lending, cross-border transactions, and merchant services. Oh, and of course it identifies as an autonomous company. That’s often more easily said than done - after all, being affiliated to a large and well-known parent firm undoubtedly has its perks. As it has grown, Boost has certainly tapped into Axiata’s user base. Its telco parent’s understanding of and ties to micro-businesses in the region have also served as a stepping stone for Boost, which focuses on serving that segment. As Boost expands its other fast-growing businesses in Malaysia, Indonesia, and beyond, CEO Sheyantha Abeykoon hints that the firm will continue to make use of its telco roots, as I detail in this week’s big story. THE BIG STORY  1️⃣ [How Axiata’s Boost stands out amid SEA’s heated fintech race]( Image credit: Timmy Loen Known for its lifestyle e-wallet, telco-linked fintech player Boost is already a household name in Malaysia, but it has bigger goals. TRENDING NEWS Check out Tech in Asia’s coverage of Asia’s fintech scene [here](.  1️⃣ [Grab buys majority stake in Ovo from Tokopedia, Lippo Group]( Photo credit: Timmy Loen Grab has increased its stake in Bumi Cakrawala Perkasa, the parent firm of Indonesian digital wallet provider Ovo, from 39% to about 90%. The deal is part of the former’s push to deepen its financial services footprint in Indonesia. The super app is also reportedly looking to sell part of its equity in Ovo to Indonesian investors so as to stay within the country’s regulations. Why it matters: We foresaw the “offloading” of Tokopedia’s stake in Ovo following the ecommerce firm’s merger with Gojek, given that there were [significant overlaps between both businesses](. While Tokopedia offers Ovo as a payment option, Gojek has a native e-wallet called GoPay. The sale draws clear battle lines between Grab’s Ovo and GoTo’s GoPay, which have gone head-to-head in the past.  2️⃣ [Investment app Ajaib becomes Indonesia’s latest unicorn with US$153m raise]( Indonesia-based [Ajaib]( a Robinhood-like platform targeting smartphone-savvy millennial and Gen Z investors, has hit a valuation of over US$1 billion after raising US$153 million in a round led by DST Global. Ajaib also counts Softbank Ventures, Insignia Ventures, and Alpha JW as investors. Including its latest funding round, the Indonesian firm has so far raised US$243 million in 2021 . Why it matters: Just two and a half years old, Ajaib is the youngest startup to reach unicorn status in the country. Like Robinhood and the mobile trading apps inspired by it, Ajaib rose in popularity during the pandemic last year as online trading caught on among young retail investors in the archipelago. Ajaib may be the first of such trading apps in Southeast Asia to reach this milestone, but it is unlikely to be the last. Other Robinhood-like apps include China’s Tiger as well as Moomoo, which have quickly become a force that traditional brokerages [have had to reckon with in Singapore](. Check out a growing list of Southeast Asia’s unicorns that [we’re tracking here](.  3️⃣ [UOB to invest US$500m in digibank TMRW, other offerings across SEA]( Photo credit: 123rf Part of the investment will go toward combining the Singapore lender’s mobile-only digital bank, TMRW (pronounced “tomorrow”), with its mobile app, UOB Mighty, to create a unified platform called UOB TMRW. TMRW currently has 355,000 registered users in Indonesia and Thailand - a number it plans to grow to 3 to 5 million users by 2025. The bank said it will progressively launch UOB TMRW across its existing markets in Southeast Asia and expects further rollouts in the next 18 months. Why it matters: UOB’s big push to unify its digital offerings across its Southeast Asian markets is significant. Indonesia, which is one of its key markets, is home to rival digital banks run by tech-driven companies like Gojek and Sea, as we laid out in [this story](. UOB is not the only incumbent bank to double down on the digibank strategy. Bank Central Asia , one of Southeast Asia’s largest lenders by market cap, said last month that it would invest US$200 million in its digital unit, Blu, to gain market share and [fend off competition]( from tech giants.  4️⃣ [MAS to launch digital platform to curb money laundering, terror financing]( Expected to be introduced by Singapore’s central bank in the first half of 2023, the platform - named COSMIC - will allow banks and financial institutions (FIs) to share information with each other on customers and transactions. It will be co-created by the MAS and six other major commercial banks in Singapore. Why it matters: Singapore was one of the biggest destinations for suspicious transactions in Asia, with US$4.4 billion of such transactions flowing through its major banks between 1999 and 2017, according to [an investigation]( published last year by the International Consortium of Investigative Journalists. The global number was US$2 trillion. Such information-sharing between banks and FIs could help overcome a common challenge they face in policing such activity. STARTUP WATCH 1️⃣ Friz - [Y Combinator joins US$1.5m fundraise by ex-Mastercard exec’s startup]( Singapore-based [Friz]( a financial platform targeting freelancers, offers products like credit cards, personal loans, insurance, and savings. The platform’s total transaction volume has grown 500% every month since May, the company says. It has also issued over 700 debit and credit cards since then.  2️⃣ Moolahgo - [Lippo Group invests US$3.3m in fintech startup Moolahgo’s pre-series A round]( Founded in 2017, Singapore-based [Moolahgo]( main product is an e-wallet that enables cross-border money transfers and payments to 40 countries. In the financial year ended March 2021, the startup’s gross transaction value grew over 700%, year-on-year, to nearly US$370 million.  3️⃣ Verihubs - [Indonesian ID and data verification startup Verihubs gets US$2.8m in Insignia Venture Partners-led round]( [Verihubs]( which claims to be the first Y Combinator-backed AI startup from Indonesia, reduces the amount of time it takes financial institutions to verify new customers from a week or two to as little as five seconds. The firm’s solution can be used by major banks and financial institutions, fintech firms, as well as ecommerce and hospitality firms. It can be used to verify both banked and unbanked customers.  4️⃣ Progap - [Tiger Global co-leads Sequoia-backed Indian fintech firm’s US$30m round]( Founded in 2017, [Progap]( provides financing for last-mile businesses using a mix of technology and alternative data-driven credit scoring. Last year, monthly disbursal volume grew 400%. The startup is aiming to hit US$1 billion in disbursals by March 2022. That’s it for this edition - we hope you liked it! Do also check out previous issues of the newsletter [here.]( Not your cup of tea? You can unsubscribe from this newsletter by going to our preference center at the bottom of this email. In the meantime, if you have any feedback or ideas, feel free to get in touch with Terence, our editor-in-chief, at terence@techinasia.com. See you next week! P.S. Don't miss out on the biggest tech news and analysis. Add newsletter@techinasia.com to your address book, contacts, or safe sender list. Or simply move us into your inbox. Too many emails? 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