Kenanga Investment Bank takes 4.99% stake In Malaysia’s Merchantrade Asia

• Various collaborations in the pipeline, towards building robust ecosystem
• Kenanga adds to digital initiatives such as online stockbroking with Rakuten

Kenanga Investment Bank Bhd (Kenanga Group) has acquired a 4.99% equity interest in Merchantrade Asia Sdn Bhd (Merchantrade), Malaysia’s leading e-money player and the country’s largest Money Services Business operator. This follows Kenanga’s recent collaboration with Merchantrade Asia to introduce Malaysia’s first stockbroker e-wallet, Kenanga Money.  The cost of the acquisition was not disclosed.

“Merchantrade Asia is one of the fastest growing digital payment and remittance brands in the country. Constantly on the forefront of digitisation and driving innovation in financial services, they are rapidly making waves across Asia in a segment projected to experience exponential growth. We are excited to be able to partake in the flourishing prospects of Merchantrade Asia and look forward to exploring more digital opportunities together,” said Chay Wai Leong, Group Managing Director, Kenanga Investment Bank Bhd.

Also backed by other shareholders that include Celcom Axiata Bhd and Sumitomo Corporation of Japan, Merchantrade Asia, founded by Ramasamy Veeran (pic), serves a customer base of over three million through its digital and app-based channels and extensive nationwide physical network.

A trusted household name, it is rapidly expanding its footprint, which includes its recent acquisition of additional stake in Singapore’s  mobile remittance service, KLIQ Pte Ltd, as well as its recent 100% acquisition of local leading digital remittance player, Valyou Sdn Bhd from Norway’s Telenor Group.

With this acquisition, Merchantrade will have a combined annual remittance turnover of more than US$2.65 billion (RM11 billion) and a network of over 1,700 touchpoints, solidifying its position as the largest remittance player in the country. Kenanga is the largest independent investment bank in Malaysia by equity trading volume and value, as well as, one of the top brokerage houses with the largest network of remisiers.

“Both are homegrown brands with sights set on digital innovations. There is tremendous synergy here, from our business models, product line-up and corporate values. However, it is the underlying shared vision and ambition we have to reshape the financial space through emerging technologies, that will power the many other exciting collaborations in the pipeline,” says Chay.

“The future belongs to the ones that can successfully engage their customers digitally through a broad and meaningful spectrum of products and services.  Building a robust ecosystem that adds value to the customers is at the core of our digital strategy. To bring that to live, finding the right partners to co-create and collaborate with, is crucial and the key to unlock longer-term growth,” he adds.

This partnership with Merchantrade Asia adds to the line-up of digital initiatives Kenanga has embarked on over recent years. This includes the successful joint venture, with Japan based Rakuten Inc, to introduce the first fully online stocktrading platform in Malaysia, Rakuten Trade, which has since seen remarkable record volume growth.

It also recently announced a partnership with digital supply chain financing company, Bay Group Holdings Sdn Bhd, to transform the traditional factoring market in Malaysia.  Also, in the works is a robo-advisory platform that will be launched early next year.