Where does Green Link fit into Singapore’s crowded financial services sector? It is hard to see at first blush. Almost all Singaporeans have a bank account, while the Big 3 incumbents (DBS, OCBC and UOB) between the three of them offer no shortage of digital financial services, especially DBS.
By not bothering with retail banking, Green Link makes its prospects better. That we can say with certainty. Sea Group’s MariBank and Grab-Singtel’s GXS Bank, determined of the omnipotence of their respective ecosystems, will be spending a lot of money to attract retail customers, while Trust Bank will be giving away a lot of FairPrice Group’s groceries to do the same.
Instead, Green Link will focus on MSMEs, underserved in Singapore as they tend to be everywhere. The digibank’s supply chain financing solutions will draw on Greenland’s experience in the real estate sector, where there are likely opportunities for cross-selling. For instance, Green Link is targeting sectors such as sustainable building materials, photovoltaic technology and smart home systems. It allows businesses to extend credit terms to buyers, while allowing suppliers to be paid early.
One reason to potentially be concerned about Green Link’s prospects is that its parent company has been adversely affected by debt crisis in China’s property sector. Greenland is China’s No. 7 property developer and is highly leveraged. In June 2022, rating agency S&P Global downgraded Greenland Holdings’ rating to "selective default" after the property developer extended the maturity of its US$500 million bonds by one year. Greenland was the first state-backed developer to extend a dollar-bond payment since China’s property sector fell into a debt crisis.
Still, Green Link Bank seems optimistic about its business in Singapore. GLDB chairman Geng Jing told The Straits Times in a February interview that the lender has already approved credit facilities of around US$50 million to businesses. Its products include working capital loans, trade and supply chain financing, and fixed deposits.
Green Link also plans to increase its headcount in Singapore by 50% in 2023, with openings across departments such as risk management, compliance and business development.
Finally, GLDB currently does not plan to obtain licenses in other markets. But it is not ruling out taking its services to China, where "it already has a competitive edge from Greenland’s presence," Geng said. Green Link might set up a subsidiary in China after it grows to meet certain conditions, and "if the business environment is suitable," he said.