YouTrip, a challenger bank in Southeast Asia, raises $25M for expansion

Singapore-based startup YouTrip thinks consumers
of Southeast Asia deserve a taste of the challenger bank revolution
happening in the U.S. and Europe, and it has raised $25 million in
new funding to bring its app-and-debit-card service to more parts
in the region.

Challenger banks have sprung up in Europe in recent years.
Unicorns Monzo, Revolut and
N26 are among those that offer their customers a debit card linked
to an app and various levels of banking services, including savings
and overdrafts. Brex —
another billion-dollar-valued startup
— is bringing that
approach across the pond to the U.S. market.

But what about Southeast Asia?

All the signs indicate this is a region where digital services
can thrive. The number of internet users across its six main
countries is larger the entire U.S. population, and
online spending is tipped to triple to $240 billion by 2025
Already, the region has mega startups including Grab ($14 billion
valuation), Tokopedia ($7 billion) and Go-Jek ($9.5 billion) whose
investors are betting that these growth signals will translate into

At the more modest end, YouTrip has pulled in this new money to
take its model beyond Singapore and into larger countries in
Southeast Asia.

YouTrip CEO Caecilia Chu counts Citibank, McKinsey and Chinese
fintech giant Lufax among her past employers

Since its commercial launch in August 2018, YouTrip has clocked
over 200,000 app downloads and completed over one million
transactions for its customers, according to CEO and co-founder
Caecilia Chu.

It covers 150 currencies in the app, but the card itself is
limited to 10 currencies (including Singapore dollars) with plans
to add local options for Southeast Asia.

Chu — who went to Havard with Grab founders Anthony Tan
and Hooi Ling Tan, as well as Go-Jek CEO Nadiem Makarim — started
the business with co-founder Arthur Mak in 2016 for frequent
travelers who are sick of being short-changed when exchanging money
for trips, or using overseas ATMs. Over the longer term, she wants
to turn the product into a more modern take on banking for
Southeast Asian consumers in the style of the aforementioned
European flagbearers.

“The objective is to build a trustworthy financial product for
the mass consumer with exchange rates that are competitive,” Chu
explained in an interview with TechCrunch. “Right now, we’re
incredibly focused on travelers.”

“The success [of European challenger banks] has certainly
helped in this part of the world where we are the first mover,”
she added.

Like Monzo and its ilk,
YouTrip offers zero percent transaction fees and no cross-border
fees, but there are “competitive” exchange rates and a
“small” fee to cover up to SG$2,000 ($1,460) in ATM withdraws per day. (Because, in much of
Southeast Asia, cash remains king.)

The plan, further down the line, is to introduce financial
products in the future to draw revenue and provide access to
services for users, Chu explained. That’s, again, straight out of
the European playbook… but there’s nothing wrong with that.

In Singapore, the card — and app — is backed by Mastercard
and it includes integration with EZ-Link, the contactless payment
option that covers public transport and more in Singapore. Those
are the kind of local integrations that the company is eying with
its market expansions.

The YouTrip service in Singapore is integrated with
Singapore’s EZ-Tap payment system

On that note, Chu, a former banker, is keeping coy on which
countries the service will expand to, but she does anticipate that
YouTrip will reach one or two new markets over the next six to
twelve months. It already has a regional footprint, though. Its
team of 70 is located across HQ in Singapore and an engineering
office in Hong Kong.

“We’re certainly looking to expand regionally,” she said.
“We will hire a local team for each country because the future of
fintech is regional and we believe in a localized strategy.”

That’s where this new money will come into play for YouTrip.
The $25 million round included Insignia Ventures Partners — the
Singapore firm from Yinglan Tan, formerly with Sequoia India and
Southeast Asia — with undisclosed family offices and angels
providing the remainder.

That’s somewhat unconventional, but Chu said the family
offices “have deep roots in Asia, are really motivated and want
to invest in our kind of business.” Likely, they understand the
frustration of moving money between borders, or for travel
purposes, in Southeast Asia and beyond.

With Revolut
continuing to stall on its planned entry to Singapore — which was

first announced last November
— YouTrip will want to seize
the initiative on establishing challenger banking in Southeast

Source: FS – All Tech News 2
YouTrip, a challenger bank in Southeast Asia, raises M for expansion