Point Hope Pte Ltd, a Singapore-based fund manager, has partnered with Longan Group Pte Ltd, the leading investor and debt servicer in Southeast Asia, to launch a funding platform that will acquire, service and restructure consumer NPL portfolios in emerging markets across Asia. The Singapore-domiciled fund, called Annexe Fund VCC – Longan NPL Fund (the “Fund”), was launched in 2022 and mainly invests in delinquent unsecured consumer credit in Vietnam and Indonesia, with plans to enter India, Malaysia, Philippines and Thailand in the coming years.
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The Fund partners with regional financial institutions and fintech companies to purchase NPL portfolios from their books. Managing the Fund is a team with 10 years of track record in consumer credit globally, comprising 150 staff members in Vietnam and Indonesia with extensive experience in credit scoring, data analysis and best practices. Longan Group’s collections teams are tech-enabled and place a strong focus on ethical resolutions to help customers reduce their debt burden and optimize cash flows. The Fund’s infrastructure in Asia uses an advanced proprietary credit scoring system that applies artificial intelligence and machine learning tools to price non-performing loans.
Within six months of launch, the debt servicing business in Vietnam became a top 3 market leader, growing its local NPL book to over USD 300 million. The Fund aims to gain a first mover advantage in the Asian consumer NPL space, aided by multiple tailwinds such as rising household debt, greater financial inclusion, and a significant growth in consumer credit.
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Fundraising started in November 2022 and has amassed a wide variety of both retail and institutional interest. The Fund is denominated in USD and offers investors an expected total return of up to 15% per annum, consisting of quarterly coupon payments and capital appreciation.
Subra Iyer, CEO of Point Hope, adds: “This is more than a collections business; while recovery of debts is a key part of it, to do so sustainably and ethically at scale is what we stand for. We are proud of the high standards to which we hold our collection teams, and the trust gained by our financial partners, to ultimately help promote financial health and solve consumer indebtedness for the two billion population in Southeast and South Asia.”
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