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KBank looks to innovations via venture capital arm

KASIKORNBANK yesterday launched Beacon Venture Capital as an investment arm with Bt1 billion to support technological innovations intended to benefit all the bank’s businesses.

Under the investment concept of the “The Next Building Block”, the Beacon fund will seek out innovations not only in KBank’s core financial services but also in customer service.
The bank has identified the support of start-ups in the fast-growing financial-technology (fintech) sector as a priority, while keeping on the lookout for potential synergies from other start-up ventures that can round out the bank’s service offerings.
KBank president Kattiya Indaravijaya said investments under the Beacon fund would enhance the bank’s capability to harness the full potential for technology to improve banking operations and customer service. The fund would invest directly in start-ups and in other venture capital funds.
“This move is to support the bank to create new digital services and solutions to serve the needs and satisfaction of consumers who are changing their behaviour in their requirement for more digital banking services,” Kattiya said. “Beacon VC will also find new technologies to support bank’s businesses in the future as well.”
Thanapong Na Ranong, managing director of the fund, operating as Beacon Venture Capital Co, said the aim for this year was to invest in three to five start-ups and in two or three other venture capital funds.
With Beacon’s launch yesterday, it also announced its first investment in a Thai fintech start-up. It is the lead investor in FlowAccount, with three other investors on board.
“FlowAccount is a fintech operation that has been working with Kasikornbank for a while and its service will potentially enhance the bank’s business,” Thanapong said. 
“Since FlowAccount has expertise in accounting systems for small and medium-sized enterprises, such customers can integrate their bank accounts and mobile banking for SME accounts through K-Plus SME. This investment benefits the start-up, the bank and the bank’s customers.”
The Beacon fund has also invested in Dymon Asia, a Singaporean venture capital fund that focuses on fintech start-ups in Asia. Beacon has committed to two other investment projects, with outlays of more than Bt200 million. 
“The beauty of Beacon VC is that it will create value to promote the bank’s products and services and to reduce the time and investment cost that would otherwise have been spent on developing innovations,” Thanapong said. “The bank can then leverage such innovation for the benefit of the bank and develop the overall expertise within the bank.”
He said the corporate logo for the Beacon fund was a lighthouse, “shining a light on the path for fintech and other start-ups”.
The Beacon team will work with the Kasikorn Business-Technology Group (KBTG), paving the way for the bank to offer new digital services based on the unearthed innovations to its 14.2 million customers. With this function, “Beacon VC will create a strategic digital capability for the bank”, the bank says.
Kattiya said: “Beacon VC and KBTG will work as a digital partnership. Beacon VC’s role is as an investor while KBTG’s role is that of an inventor. 
“Aiding these plans, the Bank of Thailand has approved KBTG’s participation in a trial of its regulatory sandbox. This will allow the bank to test innovative products, services, business models and delivery mechanisms in a live environment. KBTG will test new digital services that utilise blockchain technology.”

Published : June 07, 2017