CapitalBay Secures US$477k Seed Round Led by KK Fund
NEARLY two years ago, three Malaysians Ang Xing Xian, Dion Tan and Edwin Tan co-founded CapitalBay, a multi-bank supply chain finance platform which helps large corporations and SMEs optimise their working capital using technology. The company recently announced the completion of its RM2 million (US$476,823) seed funding round led by KK Fund.
Having previously worked at an invoice financing start-up in the UK, CEO and co-founder Ang Xing Xian witnessed how SMEs were accelerating their business by gaining access to smart working capital.CapitalBay aims to play a more supporting role in advancing Malaysia’s supply chain finance ecosystem by improving the overall cost-efficiencies. “While there has been growing interest from financial institutions, Malaysia’s supply chain finance scene is still in its infancy stage and facing a unique set of problems. We aim to support the industry’s growth through our technology, legal and operational infrastructure,” said Ang.
Problems in the market
From a pure business perspective, sellers prefer to collect payments immediately, while buyers aim to hold onto cash for as long as possible, leading to a misalignment in transactions. Consequently, large corporate buyers often impose lengthy payment terms on small suppliers who lack negotiating power. According to CapitalBay’s analysis, many SME and MSME suppliers in Malaysia now wait 50% longer to receive invoice payments compared to three years ago, with over RM100 billion in working capital trapped in their receivables. Although receivable financing options exist, they tend to be expensive and come with strict requirements, including upfront collateral—making them unsuitable for smaller businesses that don’t meet these criteria. CapitalBay was established to collaborate with financial institutions in addressing the growing funding gap within some of Malaysia’s largest supply chains, ensuring better SME financing in Malaysia and providing accessible SME finance solutions for funding business growth.
Supply chain management technology as the solution
Through its cutting-edge technology and legal framework, CapitalBay offers a platform for SME financing in Malaysia that allows SME suppliers to receive early payments from liquidity providers at competitive rates, leveraging their buyers’ credit strength without the need for collateral. This approach benefits both sides of the supply chain, enabling large corporate buyers to extend payment terms sustainably while reducing overall costs. For buyers with excess cash, CapitalBay also provides an opportunity to self-fund their supply chains, earning high returns on idle cash with minimal risk.
“Suppliers can request early payment of approved invoices at a rate that suits them, and buyers indicate their available cash. CapitalBay’s proprietary algorithm then matches these orders while automating the rest of the process,” says Ang.
By connecting multiple financial institutions to large corporate supply chains, CapitalBay simplifies the supply chain financing process in Malaysia. This eliminates the need for businesses to invest heavily in technology development and transaction management. Additionally, the platform enhances the efficiency of supplier onboarding, offering supply chain financing solutions that are tailored to fit the needs of SMEs in Malaysia.
With advanced security measures, proprietary risk assessments, and trade data analytics, CapitalBay provides a secure and efficient platform for SME finance and supply chain financing in Malaysia, helping businesses unlock trapped working capital and fuel business growth.
A triple-win outcome
As a result:
- – Corporate buyers increase cash flow and earn high risk-free returns on idle cash while being a responsible purchaser,
– SME suppliers get additional affordable and sustainable financing, and
– Financial institutions gain exposures to a low-risk financial asset while supporting the economy
So far, CapitalBay has completed multiple transaction cycles with its initial Bursa-listed buyers, who collectively hold more than RM2 billion worth of accounts payable. “The supply chain finance market is a potentially huge market (more than US$2 trillion opportunity globally), but due to the complexity, it is still largely untapped in Southeast Asia. CapitalBay is the one, and only player who is minimizing this complexity, in Southeast Asia and this would be an excellent opportunity for both buyers and suppliers,” said KK Fund general partner Koichi Saito.
This breakthrough is a game-changer for SME Financing in Malaysia, offering new avenues for business financing and providing vital support for SMEs in Malaysia to access funding for business growth without the typical hurdles.
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