The Impulso Podcast E99: Shopee's US$4.6 billion lending business
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Nov 19, 2024 The discussion reveals Sea Group’s impressive US$4.6 billion loan book, which has grown significantly while maintaining low non-performing loans. It highlights how Shopee leverages customer data to assess credit risk and boost e-commerce through BNPL services. In contrast, Grab, with a smaller loan book, is slowly but surely expanding its digital finance reach, despite its premium user base and ride-hailing model. The conversation also touches on the disparities in Southeast Asia's lending market and the evolving strategies in assessing creditworthiness.
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Sea Group's Profitable Loan Book
- Sea Group's digital financial services are highly profitable and largely self-financed.
- Their loan book reached $4.6 billion with a majority being on-book loans under their control.
Credit Challenges in Developing Countries
- Low credit card penetration in developing countries is due to poor data on consumers' creditworthiness.
- Many potential borrowers remain unserved due to lack of formal financial history and documentation.
Shopee's Data-Driven Credit Assessment
- Shopee uses detailed customer data like purchase behavior and payment methods to assess credit risk.
- This data-driven approach allows them to assign and adjust individualized credit limits effectively.