Bisnes

XOX to provide micro-financing to the tune of RM1 billion;shares jumped today

XOX Bhd, which holds an e-wallet licence (XOX eWallet) is providing micro-financing of up to RM1 billion to small business owners and entrepreneurs in digital and e-commerce space, reported the New Straits Times (NST).

                    Wetek Director, Howard Leung

XOX has signed a partnership agreement with Wetek Technology (M) Sdn Bhd, which has committed RM1 billion in financing for this.

Micro-finance is a category of financial services targeting individuals and small businesses who lack access to conventional banking and related services. The NST qouted XOX CEO Ng Kok Heng stating that the company is moving into this direction to provide entrepreneurs and small business owners access to capital and expand their business.

XOX will ride on its existing 2.2 million customer base for the business.

Ng told NST that XOX’s customer base is expected to double up by the end of this year and in fact has been growing steadily on a daily basis.

What is interesting is that XOX and Wetek may issue a second tranche of financing, provided the initial RM1 billion funding is fully taken up. I’m sure XOX and Wetek will succeed in doing this as we all know how hard it is to get a bank loan now.

Even for SMEs or entrepreneurs who want to expand their business, there is a roadblock as banks are not lending.

Perhaps it is a good thing that XOX is doing micro-financing and I believe the company will be quite successful given that its subscribers are already more than 2.2 million currently.

I’m sure there will be a high percentage of the subscribers who will grab this opportunity to get the micro-financing from XOX to build their business.

I am quite certain that this venture will also improve XOX’s bottom-line.

XOX has been trading heavily this past few days inching up from 5 sen to touch 12.5 sen today. More than 620 million shares were traded indicating strong interest in the company. Looks to me that a lot of foreign investors are coming in.

Lending or micro-financing is a good business for sure, amid the current market uncertainties.

XOX had a year ago proposed a rights issue with free warrants to raise up to RM66 million to fund its e-wallet and electronic SIM (e-SIM) businesses expansion. The company had allocated RM33 million of the proceeds raised from the rights issue to expand its e-wallet function by developing a new mobile application to support micropayments, the issuance of Mastercards and peer-to-peer e-money transfers.

Some RM15 million was set aside for its e-SIM expansion as an alternative to the traditional SIM cards.

                          Wetek Director, Liang Zeng

The directors of Wetek are Liang Zeng and Howard Leung and they come with good backgrounds.

Leung is the chairman and CEO of Brilliant (Hong Kong) Holdings Ltd and looks after the overall strategic and international business development for the company.

He is said to have an eye of identifying market opportunities across the globe with experience managing a cross-cultural team of management.

He is also a supporter of start-ups as he believes in the opportunity with young people and great ideas.

Leung started his career in the 1990s in the IT and mobile internet industry. He founded Beijing Ruidong Technology Co. Ltd in 2013.

Liang Zeng is an internet entrepreneur and venture capitalist. He invests and incubates the companies in digital marketing, artificial intelligence and enterprise services.

He has held senior positions as senior vice-president (VP) of Kingdee International Software Group, VP of Microsoft Greater China, and most recently, VP of Baidu Inc. and chief executive officer of Baidu Nuomi.

Currently, he serves as board director and strategic advisor for multiple digital marketing and technology companies.

The other director of Wetek is Liang Zeng, who is an internet entrepreneur and venture capitalist.

Liang Zeng invests and incubates the companies in digital marketing, artificial intelligence and enterprise services.

He has held senior positions as senior vice-president (VP) of Kingdee International Software Group, VP of Microsoft Greater China, and most recently, VP of Baidu Inc. and chief executive officer of Baidu Nuomi.

Currently, he serves as board director and strategic advisor for multiple digital marketing and technology companies.

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