UOB and OctoRocket to help SMEs in Asean apply for financing

• SMEs on OctoRocket for at least six months can apply for financing via the platform
• Bank will assess creditworthiness based on transactional data on OctoRocket

UNITED Overseas Bank (UOB) and OctoRocket.asia (OctoRocket), a business to business e-commerce platform, announced that they have signed a Memorandum of Understanding (MOU) to enable small businesses in Asean on OctoRocket to apply for financing quickly and easily.

OctoRocket, a joint venture launched in January by Singapore Press Holdings (SPH) and Y3 Technologies, enables cross-border trade between suppliers and buyers from Singapore, Indonesia, Malaysia, Thailand and Vietnam.

For a start, OctoRocket is helping 30 suppliers in the region’s packaged food industry to sell more than 600 types of food products such as snacks, instant noodles, canned food, sauces, condiments and beverages.

Under the MOU, UOB will enable small businesses that use OctoRocket for at least six months to apply for financing directly via the online platform.

Instead of relying on the company’s financial statements, the Bank will assess the applicant’s creditworthiness based on its transactional data on OctoRocket, using a credit assessment engine developed by Avatec.ai.

The engine harnesses the power of artificial intelligence and machine learning to gain insights into the applicant’s cashflow and day-to-day operations, determining the applicant’s credit quality quickly and with more certainty.

This will enable the Bank to cut the time taken for loan approvals from an average of 2.5 days to just 15 minutes.

Typically, small businesses need to submit two years’ worth of financial statements and six months’ worth of bank statements when applying for financing.

Through the UOB and OctoRocket collaboration, small businesses will be able to use the time spent on compiling these documents manually to focus on growing their businesses instead. In addition, small businesses no longer need to wait two years before being eligible for a loan.

UOB Group Business Banking head Lawrence Loh, said, “Small businesses, which comprise nearly 99% of total enterprises in Asean, form the backbone of the region’s economy. Given the important role in they play in the economy, we want to help them drive efficiencies to grow their business effectively. Helping them save time for optimal use is one way.

“This is why we collaborated with OctoRocket to make it seamless and almost effortless for all businesses on the e-commerce platform to apply for financing. Through our AI-driven credit assessment engine which analyses traditional and alternative sets of data to assess a business’ creditworthiness faster and more accurately, businesses on OctoRocket will enjoy faster loan approvals. This will benefit e-commerce buyers and sellers who may need the credit to seize business opportunities quickly as they arise.”

OctoRocket chairman and SPH Digital Business chief Julian Tan, said, “Many small- to medium-sized businesses have started to explore opportunities overseas for higher revenue and returns. We saw an opportunity for e-commerce to support suppliers as a group to help them reach the right buyers in different markets.

“For a start, OctoRocket caters to manufactured food products and buyers within Asean. Our primary focus is to connect and deliver user-centric, reliable lending solutions to our business users and partners. In this experience, both buyers and sellers will trade with confidence and eventually, form strong cross-border business relationships.

“As such, we see a great synergy between UOB and OctoRocket. In recent years, UOB has placed significant emphasis on helping SMEs go digital to increase their productivity and competitiveness.

“Furthermore, their quest to harness technology to make banking simpler and smarter will help streamline the trading and financing processes on OctoRocket. We strongly believe that the partnership will allow us to work towards bringing the convenience and consistent business connectivity to all our users.”