Boost has become the first fully digital financier in Southeast Asia to secure an investment-grade A1 rating from RAM Ratings for its maiden tranche of Senior Class A Medium Term Notes (MTN) of securitised financing receivables.

The rating underscores Boost’s capabilities and competencies in accelerating financial inclusion through Boost Credit (formerly Aspirasi) using robust alternative data scoring frameworks. Its portfolio underwent thorough scrutiny and demonstrated soundness to meet its financial obligations.

Boost said in a statement that Boost Credit has a non-performing financing (NPL) rate of less than 3 percent from funds disbursed to finance SME customers’ working capital, supply chain and invoice financing needs to grow their business. This is enabled by stringent credit scoring underpinned by a host of alternative data and AI models.

Sheyantha Abeykoon, CEO of Boost said, “We are glad to once again, set the standard for an industry which is at a very nascent stage but has immense potential. The A1 rating of the securitised tranche is a testament of the quality of our financing portfolio and the robustness of our alternative lending platform. Our digital-first solutions are simple and conveniently available to customers, incorporating a comprehensive e-Know Your Customer (eKYC) with a 3-minute digital application journey supported by AI and machine learning tools.

“We anticipate this rating will help diversify our capital base, enabling us to further support more SMEs. We are wholly focused on our aspiration of championing financial inclusivity, and we are excited at the prospects of serving more SMEs as we move towards becoming a full spectrum regional fintech player.”

Gurpreet Khera, chief business officer of Boost Credit said, “The A1 rating is a significant milestone in our journey of building a truly Digital Bank, and a natural progression to provide comprehensive digital financial services for the region. The rating also reflects our commitment to continuously improve our product offerings as we envision a financially inclusive ecosystem in Southeast Asia.”

The rating for the receivables to be securitised provides reassurance to potential investors about Boost Credit’s operational capability to support such exercise. It also signals to stakeholders that its products have been vetted and meet the requirements for the securitisation exercise under an A1 rating.

The rating is applicable to the Senior Class A Medium Term Notes with a tenure of 30 months and will be issued by a Special Purpose Vehicle (SPV) Salvare Assets Berhad and reviewed on an annual basis. Boost Credit intends to issue more MTN tranches as it grows its financing portfolio to meet the needs of SMEs.

Credit has disbursed in total more than RM1 .2 billion in financing to SMEs in both Malaysia and Indonesia in the last three years. Applicants enjoy a 3-minute digital application journey with a quick approval process to meet their financial needs to grow their business.

Last year, Boost announced a formal partnership with RHB Bank to form a consortium and bid for a digital bank license. The consortium was one of 29 formal applicants received by Malaysia’s central bank, Bank Negara Malaysia (BNM). It is anticipated that up to five successful applicants will be granted a licence by the first quarter of 2022.

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