KUALA LUMPUR: Funding Societies | Modalku, Southeast Asia's largest SME digital finance platform, has secured US$25 million (RM112 million) in equity investment from Cool Japan Fund (CJF) Japan's sovereign wealth fund.
This marks CJF's first-ever investment in a Southeast Asian fintech company and a milestone for Funding Societies as it celebrates its 10th year of serving SMEs.
The investment will allow Funding Societies to strengthen its SME financing business across its five core markets: Singapore, Indonesia, Malaysia, Thailand, and Vietnam and fuel the expansion of its payments business which was launched in 2022.
Through this partnership, Funding Societies will collaborate with CJF to support Japanese companies expanding into Southeast Asia by fostering closer ties between Japanese firms and local SMEs.
"We are excited to back Funding Societies through this investment. Their track record of supporting SMEs in Southeast Asia places them in a strong position to help Japanese companies overcome challenges in new overseas markets" Cool Japan Fund president and CEO Kenichi Kawasaki said.
"This partnership will drive demand for Japanese products and services while benefiting local SMEs doing business with Japanese firms," he added.
"We're honoured for the commitment from Cool Japan Fund to collaborate and support Japanese companies expanding overseas," said the Funding Societies | Modalku Co-founder and Group CEO Kelvin Teo.
"Many businesses we serve in Southeast Asia are Japanese firms, suppliers, or customers. Together, we aim to strengthen these ties further."
Southeast Asia has seen a surge in demand for digital financial services, with digital lending projected to drive 65 per cent of total industry revenue.
In 2024, the regional loanbook grew over 20 per cent year-on-year to US$71 billion (RM317 billion), still covering less than 1 per cent of the region's US$2.5 trillion (RM11 trillion) credit gap.
Meanwhile, the total market is expected to expand to US$200–300 billion (RM894 billion–1.34 trillion) by 2030.