• Validus Capital (Validus) isfilling a critical financing gap for SMEs across industries to fuel SME growth
• GDP contribution from Validusfinanced SMEs grew by 18 per cent as compared to 8 per cent frombusinesses overall
• Validus lending has supportedover 10,000 jobs in Singapore and SMEs who obtained financing from Validusexperienced strong employment growth of 12 per cent

SINGAPORE - Media OutReach - 7 November 2019 - Singapore's top SME financing platform ValidusCapital (Validus)today announced that small and medium-sized enterprises (SMEs) that received financing through  their platform has enabled them to grow theirbusiness. It was found that these SMEscontributed S$403 million to Singapore's gross domesticproduct (GDP) and supported over 10,000 jobs in the country, based on data from 2017and 2018. With this trend, Validus expects that their financed SMEs areexpected to contribute an additional S$500 million in 2019 -- given thatdisbursals this year have exceeded the combined amount in the past two years --bringing the total to close to S$1 billion in GDP contributions across 2017, 2018and 2019.

Vikas Nahata, Executive Chairman & Co-founder of Validus, sharing the findings of Validus Economic Impact Study

The study was conducted by Steward Redqueen, a leadingconsultancy firm focused on impact management and sustainable entrepreneurship.

SMEs are the backbone of Singapore's economy andworkforce. In 2018, SMEs contributed 48 per cent to Singapore's GDP and employ72 per cent of the country's workforce^[1].However, many of them continue to face challenges in gaining access tofinancing required to grow their business. Many do not have a solid trackrecord of having credit and collateral, and this prevents them from securing abank loan to grow their business. SMEs being light in fixed assets means thatbanks will often take a longer period to approve their request.

Steward Redqueen's study demonstrates howValidus' financing positively impact both the SMEs and wider economy. SMEs thatobtained financing from the platform experienced a 17per cent increase in their annual revenue in 2018. GDP contribution fromValidus-assisted SMEs grew by 18 per cent. This is in contrast to the overallGDP contribution by Singapore's businesses of 5 per cent¹ in thesame year. In addition, SMEs who obtained financing from Validus experienced arobust employment growth of 12 per cent as compared to 1 per cent the overallemployment growth of Singapore's businesses¹.

"Validus is proud to be able to contribute to thegrowth of Singapore SMEs. We want to provide growing SMEs faster access to zero-collateralfinancing. The findings from Steward Redqueen's study is a testament that ouronline financing solutions are on track to make a significant impact inplugging Singapore's SME financing gap. As Validus prepares to apply for theDigital Wholesale Banking licence in Singapore, we are confident that thesocio-economic impact will be positively higher given the digitaltransformation that could be made possible through a digital banking licence," said Vikas Nahata, Co-Founder and Executive Chairman,Validus Capital. 

SMEs are seeking financing solutions todrive sales, expand their local operations and internationalise their business.Validus is filling a critical financing gap for SMEs across differentindustries by leveraging the use of Validus' proprietary technology to provideefficient and flexible financing solutions that are customised to the needs ofthe respective SME borrower.

Nahata added, "Many businesses continue tohold the belief that having debt on their balance sheet is detrimental. Ourstudy reinforces that debt can be a growth-enabler when prudent capitalmanagement is exercised. In order for us to continue serving the SME community,we are partnering with banks and corporates who have SME vendor ecosystems to further facilitate affordable growth financing. Thisallows more SMEs to tide through Singapore's challenging economic environment,while bringing innovative ideas to fruition and grow their business."

"To estimate the impact results, we tracehow financial flows associated with Validus' financing circulate in theSingaporean economy. These flows are traced using the input-output (IO)methodology; which is to a great extent developed by the Nobel Prize winningeconomist Wassily Leontief and is commonly used by economists to quantifyindirect impacts. Notwithstanding its limitations, this approach providesrobust estimations and is the 'go-to' approach for many development financeinstitutions around the globe," said Tias van Moorsel, Managing Director ofSteward Redqueen Singapore.

Singapore's economy grew by 0.1 per cent year-on-year (y-o-y) in the third quarterof 2019,narrowly avoiding a technical recession^[2].On an annual basis, the Ministry of Trade and Industry (MTI) revised its growthestimates to be between 0 and 1 per cent in 2019. Furthermore, SMEs are expecting their turnovers to be lower in the next twoquartersowing to global macroeconomic conditions.

Earlierin February 2019, Validus raised S$20.5 million in an oversubscribed Series Bfunding round led by Dutch public-private development bank FMO and invests inprivate sector growth in emerging markets. In July, Validus announced its plansto be among the first Singapore fintechs to apply for a digital bank licence inSingapore, with a vision to createan inclusive, 360-degree solution for SMEs inSoutheast Asia. 

Validus also officially launched itsVietnam entity, Validus Vietnam, yesterday in Ho Chi Minh City as part ofthe company's goal to drive business financing for SMEs in Southeast Asia.

About Validus Capital

Founded in 2015, Validus Capital isSingapore's largest SME financing platform, and has facilitated over S$300million in business financing to SMEs in Singapore to date. Backed by AAA-ratedDutch Development Bank FMO and Vertex Ventures, Validus holds a Capital MarketsServices Licence by the Monetary Authority of Singapore (MAS), and itsIndonesian arm Batumbu has received OJK registration in April 2019. As acatalyst of sustainable growth for SMEs, Validus connects accredited investorsto SMEs through its peer-to-business lending platform, that is powered byproprietary technology leveraging a secure and robust cloud infrastructure as adelivery mechanism. For more information, please visit www.validus.sg.