Lightnet goals to interrupt obstacles
Thai startup needs to the Visa of Asia-Pacific for cross-border funds
Whereas Thailand’s startup scene may be small, one among its up-and-coming fintech startups is brimming with world-scale ambitions, aiming to leverage its mega-conglomerate connections to change into Asia’s major cross-border fee community.
Lightnet, based in 2018 and chaired by Charoen Pokphand (CP) inheritor Chatchaval Jiaravanon, seeks to interrupt the barrier between cross-border and home funds by making transactions throughout currencies so low cost and quick, cash senders will barely see the distinction.
Through the use of the cryptocurrency Stellar as an middleman for cross-currency monetary transactions, the corporate goals to make conventional worldwide cash switch choices like SWIFT and Western Union out of date.
Tridbodi Arunanondchai, Lightnet’s group chief govt, stated the agency goals to be the first cross-border fee middleman for Asian banks, tapping into the massive inhabitants of abroad employees throughout Asia-Pacific that frequently make remittance funds. In Southeast Asia the quantity of remittance funds is valued at US$150 billion per 12 months.
“What is the difference between remittances and payments?” he stated. “It’s just adding the word cross-border. Our goal is to make payments universal and borderless.”
PROJECTIONS TO THE MOON
In January, Lightnet raised $31.2 billion in Sequence A funding from giant Asian monetary establishments together with UOB Ventures and Seven Bank. It has 10 bank companions, with Siam Industrial Bank its largest Thai accomplice.
Mr Tridbodi, a former funding banker, stated Lightnet will quickly have its first transaction from a 7-Eleven retailer, doubtless a cash switch between Japan and Taiwan.
The corporate is ready for the Bank of Thailand to subject a licence to 7-Eleven Thailand, owned by a CP Group subsidiary, to permit clients to make remittance funds on the comfort shops.
“Utilizing transport as an analogy, conventional banks are like automobile firms, home fee providers like PromptPay are like railroads, however we’re an airline that may facilitate entry to the complete world,” he stated.
Mr Tridbodi estimated Lightnet’s community will deal with $1 billion in transactions this 12 months, a quantity he hopes to extend by 5-10 occasions subsequent 12 months. Finally he sees Lightnet rising to the dimensions of Visa with its community the first cross-border switch middleman for banks throughout Asia. Thailand and Indonesia are its largest markets when it comes to transaction quantity.
The startup spent its first two years growing its community and solely started facilitating transactions this 12 months. It at present employs 150 individuals with 60 in Thailand and the rest primarily based in China and the US.
“From now until the second quarter next year we want to make sure we have a large amount of transactions and scale up our Asia-Pacific coverage, and after the second quarter we can talk about looking into partnerships and joint ventures in other regions,” Mr Tridbodi stated.
FINTECH REVOLUTION
Lightnet is totally business-to-business, with cash switch clients unlikely to pay attention to its participation within the transaction. The bank dealing with the remittance can select between Lightnet and different cross-border switch choices.
He stated Lightnet’s community cuts the price of cross-border funds by decreasing the variety of middleman events from about 5 with conventional providers to 2 (the sender and receiver), whereas prices will be additional lowered because the community scales up.
Mr Tridbodi stated Lightnet selected Stellar because the cryptocurrency settlement system for transactions as a result of it’s comparatively small and the group behind Stellar can dedicate time and a spotlight to a partnership. Finally the corporate needs so as to add extra cryptocurrencies to its community with the intention to scale sooner.
Whereas he has unwavering confidence in his firm’s know-how to dominate the cross-border fee market, Lightnet shouldn’t be alone on this area.
In Thailand, Lightnet faces competitors from DeeMoney, a fintech startup operated by telecom supplier SawasdeeShop and partnered with SuperRich Worldwide Alternate, which is growing its personal community with the cryptocurrency Ripple.
“There are very few startups in this space making actual transactions with financial institutions,” stated Mr Tridbodi.
“We are making transactions with SCB, and 7-Eleven. We are also probably the first blockchain startup in the world backed by eight leading conglomerates, while the rest are backed by venture capital firms.”
He stated the corporate will search Sequence B funding subsequent 12 months to develop its community and make merger and acquisition offers, doubtless ready 5-10 years earlier than launching an preliminary public providing (IPO).
“I think Lightnet will have an IPO when fintech is accepted as an equal to a bank,” stated Mr Tridbodi.
“When Ant Group tried to do its IPO, regulators did not accept it as a bank. We have to wait until fintech revolutionises the sector.”
