Revolut: Expanding into Southeast Asia

• Fintech Revolut gained over 77,000 customers in less than two years by launching in the heart of Southeast Asia – Singapore
• It chartered a smooth journey by understanding the landscape, building on global and local partnerships and hiring an all-star team
  
• With the support of the local ecosystem, the company has successfully launched a range of products and services to better serve its customers
  

Less than two years since launching in Singapore, fintech company Revolut has gained over 77,000 customers with no signs of slowing down. Their secret to success? A prime location at the heart of Southeast Asia (SEA).

“Singapore represents not just an audience of 6 million, but a bridge to SEA’s 600 million population,” said James Shanahan, CEO of Revolut Singapore.

A market brimming with opportunity

Founded in London in 2015, Revolut offers a suite of financial services to consumers and businesses in over 40 markets worldwide. This includes peer-to-peer transfers, foreign exchange, trading and cryptocurrency.

Since its early days, the fintech company set its sights on SEA. The region is home to a diverse, young and rapidly urbanising population which provides a vast addressable market. SEA is also home to 350 million mobile subscribers (the third largest in the world) and digital spending is predicted to more than triple by 2025. For a digital-first service like Revolut, this tech-savvy demographic makes SEA a prime opportunity.

Singapore was a natural first choice for the company to find its footing in the region.

James added that the country’s abundance of high-calibre talent, connectivity to SEA and clarity in financial regulations makes it an ideal launchpad.

Indeed, the country’s finance regulator – the Monetary Authority of Singapore’s (MAS) – has stepped up efforts to create a business-friendly environment for fintech. Over the years, MAS has implemented a slew of initiatives, such as the Financial Sector Technology and Innovation Scheme, to upskill local fintech talent and accelerate adoption of technology in the sector. Beyond funding, the agency has also introduced policies to support innovation, such as a sandbox to speed up testing of financial products and services.

Charting the voyage into SEA.

While SEA holds much promise, its diversity also poses challenges for companies in the fintech space. According to Oliver Wyman’s Singapore Fintech Landscape 2020 and Beyond report, firms face a heterogeneous regulatory environment in SEA with over 70 different financial services licenses, creating a landscape difficult for new market entrants to navigate.

Despite these challenges, Revolut has had a smooth journey by sticking to its expansion playbook.

Navigating global disruptions

With its boots firmly on the ground, Revolut launched with 30,000 customers in October 2019. But soon after, the pandemic struck and fintech companies across the region suffered a substantial blowback. Revolut was not spared either.

The company found ways to rebound. “When travel fell away, we built communications and product education around Revolut as an everyday card. New features such as Rewards, an in-app cashback programme for online shopping, helped customers see the app in a different light,” said James.

“I’m pleased to say in Singapore, our revenues have recovered. We’ve got a stable situation – our customers are realising that Revolut can be used to manage many aspects of their financial lives, in addition to travel spending when that returns,” he added.

Better serving customer needs through Singapore

Since its recovery, Revolut has been expanding its customer offerings. With the country having the highest concentration of regional headquarters in Asia Pacific, the fintech firm has been able to launch new products and services with the support of the local ecosystem.

Some of its initiatives include:

• Launching Revolut Junior to a new segment: By collaborating with VISA, Revolut launched a card and account for children, enabling the company to expand its product offerings to a new audience.
  
• Integrating Revolut into local FAST payment networks: Revolut integrated its digital wallet into the local FAST payment network, enabling its customers to transfer funds swiftly across local banks in Singapore.
  
• Partnering with merchants to offer cashback services: By forging new partnerships in Singapore and tapping on its global collaborations, the fintech company launched cashback deals for online purchases to customers.
  

As for companies unique to the region, James elaborated, “Companies here are transparent and are very outward looking, so they understand that we want to build a network in Singapore, then extend that to overseas.”

Scaling across SEA

What’s next for Revolut? With a firm footing in Singapore, the fintech company is setting its sights on the wider SEA region. Singapore, said James, will also be able help Revolut with acquiring licenses within SEA’s heterogeneous regulatory landscape.

“We have to look at the partnership opportunities and see who we can work with to get access to other markets and bridge the gap to these regulatory requirements,” said James.

“Singapore is a good hub to conduct those sorts of conversations, because it sits within Southeast Asia’s strategic network of countries. While you still have to travel to a country, you can learn a lot about it from Singapore and leverage the long history of cross-border collaborations to initiate a lot of collaborations and deals.”