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Building a next-generation financial institution: A conversation with Jean Fernandes, CFO of GXS Bank

Written by Khamila Mulia Published on   4 mins read

GXS Bank was founded by Grab and Singtel. It will integrate with Grab’s app when it launches this year.

Southeast Asia is ripe for digital banking. Even though internet coverage is spreading across the region, around 70% of its population remains unbanked or underbanked. Over the past decade, tech companies have been racing to offer services to people who have been left out of conventional banking systems to convert this underserved segment into customers.

In December 2020, the Monetary Authority of Singapore (MAS) issued four digital bank licenses, including one to a consortium formed by Grab and Singtel. The online-only bank allows customers to perform many types of transactions via an app without having to physically visit a brick-and-mortar branch. This means a customer can open new savings and checking accounts, then transfer money and make payments by using their smartphones.

The digital bank established by Grab and Singtel is called GXS Bank and is set to launch in 2022. It has ramped up its hiring over the past year and poached people from the banking industry to fill senior roles. This includes CEO Charles Wong, who was previously retail head of Citibank Singapore, and CFO Jean Fernandes, who was with Standard Chartered Bank for 20 years before joining GXS in 2021.

Jean Fernandes, chief financial officer of GXS. Photo courtesy of GXS.

“At GXS, we are on a mission to boost financial inclusion in Singapore and Southeast Asia by building a scalable next-generation bank,” Fernandes told KrASIA.

Fernandes leads the finance department of GXS. This draws upon her two decades at Standard Chartered Bank, where she was regional CFO for South and Southeast Asia as well as CFO for global corporate and institutional clients.

This extensive professional experience gives Fernandes the means to weigh risks and introduce financial and strategic discipline to her team. “We challenge ourselves every day to use technology and data so customers can have access to relevant banking products,” she said.

Grab has a 60% stake in GXS, while Singtel holds the remaining share. After the digital bank launches, its platform will integrate with Grab’s app, allowing users, driver-partners, and small business owners to open bank accounts and access GXS’s services through the ride-hailing and meal delivery platform.

With the proliferation of smartphones and mobile internet across Southeast Asia, digital banks are becoming popular alternatives to conventional financial institutions. Fernandes’ team is shaping GXS’s strategies for the bank’s overall financial planning and commercial expansion, and ensuring that it has a sound financial and operational environment by instituting robust processes and controls. The team also designs financial frameworks and policies.

Technology is transforming the financial industry and creating new relationships between customers and service providers. Fernandes said she is excited to see consumers interacting online and continually modifying their expectations from digital services.

“More people are accessing goods and services through marketplace platforms, and they are becoming part of communities through social media. I’m excited about this, as it gives us the opportunity to rethink how customers engage with their banks,” said Fernandes.

Digital banks and fintech companies use customer data to perform risk analysis, fraud detection, and to customize services based on user activity and preferences. These insights help platforms like GXS understand their customers better, she added. “We’re rethinking the conventional ways in which people transact, access credit, and invest. For example, by widening the pool of data that we use to analyze creditworthiness, such as data sets from social media and our ecosystem network, we can improve financial inclusion by opening up credit access to consumers who may not meet traditional credit assessment requirements.”

Gig workers are one group of consumers who might benefit from the way GXS evaluates clients. While they may have steady income streams, gig workers like ride-hailing drivers or couriers may not qualify for loans because they do not have a credit history. “By using alternative data to supplement our credit-scoring models, we can help these people access the credit lines they need,” said Fernandes.

Millions of people in the Grab and Singtel ecosystem are potential customers for GXS. ​​For many driver-partners, Grab is their entry point into the formal banking system. New drivers are required to provide a bank account as part of their registration. If they don’t have an existing bank account, the company helps them apply for one. For these new entrants to the banking system, it becomes natural for them to use GXS’s services.

Grab’s financial arm, Grab Financial Group, already has multiple offerings, including payments, lending, insurance, and wealth management. Digital banking is the next step in Grab’s strategy to further monetize its user base. Plus, financial and banking services may be more lucrative than its cash-burning ride-hailing business.

Beyond Singapore, Grab and Singtel are also bidding for a digital banking license in Malaysia. Bank Negara Malaysia, the country’s central bank, has received applications from 29 bidders and will award up to five licenses in 2022. Grab and Singtel are also on their way to operating an online bank in Indonesia. The two firms each acquired a 16.3% stake in local lender Bank Fama.

Fernandes didn’t comment on GXS’s plans in other regional markets. She is currently focusing on the upcoming launch in Singapore. “It has been very rewarding to see our efforts come together. Our daily routine is to expect the unexpected—as there is no playbook for building a digital bank from scratch—and we are exploring new ideas to serve our customers,” she said.


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