"FinTOB is a fintech company that provides supply chain finance platform services."

Park Sang-soon, CEO of Fin2B, introduced the company in a recent interview with the Seoul Economic Daily. The company aims to establish a supply chain finance platform in Southeast Asia, including Vietnam and Indonesia, and support financing of local small and medium-sized enterprises. Park, who has been specializing in digital and corporate finance consulting at Boston Consulting Group Korea for more than 18 years, established Fin2B in 2015 and has focused on boosting supply chain finance.

Supply chain finance is a financial system that improves liquidity of funds by combining companies and financial institutions participating in supply chains. For example, if Samsung Electronics makes and sells mobile phones, numerous small and medium-sized companies will participate in the mobile phone supply chain. Company A makes and delivers camera modules, Company B makes and delivers protective films, and Company C distributes finished mobile phones to dealerships.

The problem is that small and medium-sized enterprises that participate in the supply chain are in a chronic shortage of funds. Even if they deliver, money usually comes in after one to two months, and even if they want to borrow, they do not have reliable financial statements or collateral. CEO Park pointed out that "From the perspective of financial companies, SMEs are difficult to supply funds due to high risk and low profitability."

Accordingly, what Park presented as a solution is a supply chain finance platform. "For example, if Samsung Electronics has accounts receivable that it will pay in 40 to 60 days, it can secure those receivables as collateral," Park said. "If intermediate processes such as bond transfer are managed well, financial companies can give money to SMEs by securing the receipt of money from a reliable conglomerate." "From the perspective of SMEs, it is an attractive alternative in that it can leverage the credit of large companies," Park added.

At this time, CEO Park entered the Southeast Asian market where such supply chain finance has not yet developed since 2019. He said, "The important point in supply chain finance is 'reverse factoring' to resolve information asymmetry, but there is no such thing in Southeast Asia." Reverse factoring is the process of checking and inquiring about the reliability of accounts receivable through the information posted by a company purchasing accounts receivable on the network.

If a large company (buying company) says, "It is right that a small and medium-sized company (selling company) A will receive 50 million won (approx. The bank confirms this and pays the money to the company A." In order for the process to proceed smoothly, a smooth networking system between purchasing companies, financial companies, and selling companies should be established. "In Indonesia, there are more than 100 financial institutions, but it is difficult to establish a system due to poor capital capabilities," CEO Park said. "PINTOB has created a system that enables users to check accounts receivable in each country and even view repayment of loans, or a platform, and supplies it to financial companies."

In fact, Pintob launched services in Vietnam and Indonesia in September 2019 and August last year, respectively, and is expanding its business in earnest. In Vietnam, it is providing services to Mirae Asset Consulting, Woori Bank, Shinhan Bank, and KB Kookmin Bank. In Indonesia, it has signed contracts with Bukopin Bank and KB Capital's local subsidiaries. In recognition of this business feasibility, Pintob received a total of 3 billion won in investment from Shinhan Financial Group and Korea Growth Finance in June, 1.5 billion won each.

Park plans to speed up cooperation with local financial institutions as well as overseas subsidiaries of domestic financial companies. Currently, the cumulative loans executed through the FinTOB platform amount to a total of 40 billion won, and the company expects that more than 100 billion won worth of cumulative loans will be achieved by the end of this year.

Meanwhile, Park is also pushing for a new digital accounts receivable platform business based on blockchain. "The blockchain technology will block forgery, alteration, and double transfer risks, which can be used as other payment methods, or early monetization can be activated," Park said.