AMP Credit Technologies has launched a groundbreaking pilot lending programme with leading Asian bank DBS.
AMP Credit Technologies launched in the UK in March last year, with a view to reenergising bank lending to small businesses. The company combines innovative credit modeling with daily cash flow data in order to allow the established financial institutions to offer an unsecured SME loan product. CEO Thomas DeLuca has long hinted at having bank partnerships in place behind the scenes, but the DBS deal is the first to hit the newswires.
The pair are launching a pilot scheme by the name of DBS mLoan. The product itself is a short-term (3-12 months), unsecured, working capital loan – for amounts of up to SGD100,000 – targeting the small businesses of Singapore. AMP infrastructure will power the loans. The technology uses electronically verifiable cash flows, such as card payments, to assess applications. These cash flows are then weighed against sector models of payments and collections, and credit assessments are then made. The loan product is suited to the kinds of small businesses that accept card payments, and that have been in operation for at least six months. Repayments are drawn from the borrower’s existing business bank account, minimalising friction. Repayments are exacted as fixed, equal installments, which are directly debited from a borrower's core business operating account on every banking business day.
For an idea of the potential scale of the partnership, DBS boasts over 280 branches, spread across 18 different markets, and employs 22,000 staff. The bank is headquartered and listed in Singapore, but has a growing presence in Greater China, Southeast Asia and South Asia.
One might argue that the AMP tie-up is at least in part comparable to the high profile partnership that was recently struck between OnDeck and JPMorgan Chase, which was forged in order to allow Chase to more effectively lend to its c. 4 million small business customers, through the usage of OnDeck’s innovative credit scoring technology.
AMP launched an investment vehicle by the name of Amplifi Capital in April 2015, which channels money through to SMEs via the AMP platform – serving as something of a “shop window” for interested financial institutions. With the first of its bank lending programmes now under way, CEO Thomas DeLuca is understandably optimistic:
“We are very pleased to be working on this exciting initiative with DBS, which is a frontrunner in innovative thinking. With DBS’ leadership and AMP’s patented platform, Singapore small businesses will finally have an option to obtain working capital that is equitable, transparent and convenient. We look forward to working with DBS for a successful rollout in Singapore and ultimately across the region.”