World Bank leads Compare Asia’s funding to spur Hong Kong customers to switch banks
World Bank’s International Finance Corp. leads a US$50 million funding round of CompareAsiaGroup, the parent of MoneyHero, a price comparison website for financial services from credit cards to mortgages and insurance
Compare Asia Group, the parent company of MoneyHero, a Hong Kong-based price comparison website, said it’s completed a US$50 million series B fundraising round led by the World Bank’s private sector arm the International Finance Corp., underscoring the popularity of financial technology, or fintech, in helping consumers find the best bargain for financial services from credit cards to mortgages.
The four year old company will use the funding to enhance its user experience to help improve the level of financial literacy in Hong Kong and drive innovation by encouraging customers to shop around when choosing financial products.
Hong Kong’s consumers tend to be more loyal to their banks, and less prone to switching out of their traditional financial service models, which leave the city’s lenders with little compulsion to change their products or services, compared with financial firms across the boder in China.
“What we are doing is making it easier for them” to pick and choose, said MoneyHero’s managing director Rachel Lam.“Financial literacy in Hong Kong also lags behind other places, and our attempts to improve this were a reason for the IFC’s investment in the company.”
This is now starting to change however, and Lam said that the price comparison site was also hoping to drive innovation in Hong Kong’s banking sector.
“Global investors see the massive potential and fast growing demand for digital finance in Hong Kong. This significant investment represents a genuine vote of confidence in Hong Kong’s vibrant fintech community,” he said.
Fintech financing in Asia Pacific more than doubled last year to US$11.2 billion, from US$5.2 billion, according to research published by consulting firm Accenture. Hong Kong and China accounted for 91 per cent of this investment by value.
“Alibaba and JD.com were two major fintech investors this year, as they focus on providing their customers with end-to-end services,” said Albert Chan, Accenture’s managing director of financial services in China. “Well aware that they’re facing disruption from outside the industry, many of China’s financial services companies are making investments in fintech.”
Lam said that MoneyHero would use the funding to develop its user experience by further developing its technology and team. She said that as well as funding the company looked to build further links with its investors, but declined to say which or in what areas.
Goldman Sachs, and the Alibaba Entrepreneurs Fund – a non-profit initiative by Alibaba Group Holdings, the owner of the South China Morning Post – are also series B investors in CompareAsiaGroup.