According to a recent report, an online recurring payment start-up has closed its seed funding round with investment from a firm that invests is known to back marketplaces, new media, fintech, agritech & enterprise applications.
The online payments firm plans to use this capital to further grow their Malaysian operations and take their online Direct Debit payments platform to the mass SME market.
The online payments firm facilitates transactions by intermediating between buyers, sellers, and their banks, making the process of administering bank-to-bank payments easy.
The online payments firm was founded in 2017 and it seeks to help businesses in collecting recurring payments and helping companies control cash flow. The API-automated system provided by the company enables SMEs to ditch manual methods like cash and cheque or credit card processing.
The online payments firm said since its launch, it has processed US$12.3 million (MYR50 million) worth of transactions for companies several major companies and SMEs.
The Co-founder and CEO of the online payments firm noted that cash flow is the lifeblood of any business, particularly with SME companies, and up until now collecting payments has been incredibly admin-heavy and expensive.
SMEs have traditionally been underserved by banks, so the online payments firm aims to provide a solution that takes the pain out of collecting payments to let businesses actually focus on growing their business.
The Chief Executive of the firm that invested in the start-up stated that there is a large opportunity in this space, as Direct Debit has traditionally been the hardest payment method for businesses and consumers to access prior to the introduction of the online payments firm.
The direct Debit method is believed to have low penetration in Malaysia and the rest of Southeast Asia compared to Europe and other developed nations.
The approach requires a larger workforce dedicated to just manage this admin task, something that the online payments firm believes not every SME can afford.
Malaysia’s IR 4.0 Goals
According to the Industry 4.0 Policy, the Malaysian Government’s role in the digital transformation process is as an enabler, as such, the Policy is aimed at ensuring the adoption of Industry 4.0 technologies is done as seamless as possible, and that those technologies are equally accessible to SMEs.
While Industry 4.0 technologies present both opportunities and risks for SMEs, it provides an opportunity for the small companies of today to become giants of tomorrow.
Thus, it encouraging to see Malaysian start-ups receiving support.
It is important to note that in Malaysia’s transformation, particular attention needs to be given to SMEs as they account for the bulk of manufacturing companies (98.5%) and a major part of employment (42%). While most of these SMEs do not have a strong global presence, many have the potential to be global exporters.
So, SMEs, like the aforementioned online payment firm, stand to gain the most from this Policy. The aim is to optimise the framework conditions and support structures accordingly so that manufacturing SMEs will be able to meet the challenges of Industry 4.0 and take full advantage of the benefits and opportunities it presents.
