KUALA LUMPUR: Shariah-compliant gold savings platform, HelloGold is aspiring to go beyond gold trading alone as it eyes to become a virtual bank within the short term.
In an interview with NST Business, founders Robin Lee and Ridwan Abdullah explains why financial technology (fintech) is not an enemy to the traditional banking industry but is in fact, an ally.
“We started the development of HelloGold in 2016 to create financial products for the underserved and the unbanked in emerging markets, before its official launch in April 2017,” said Lee, who is also HelloGold’s chief executive officer.
“We chose gold because globally, regardless of circumstances, people intuitively understand the financial benefits of holding gold as a hedge against inflation or as an insurance for difficult times. It was therefore logical for HelloGold to focus on making gold as our first savings product which is accessible through mobile platform and affordable with minimum investment of RM1.”
Ridwan explained that this is especially important given that Bank Negara Malaysia and other government agencies have said that most Malaysians are not saving enough for their future.
“We believe that gold is a good and alternative way to save. It is one of the world’s safest assets and its value has historically grown in line with inflation,” he said.
Since its launch, the HelloGold has over 150,000 downloads and about 80,000 customers and an estimated RM6.5 million in value had transacted on the app and this number is still growing.
“Because we are new, our opportunity for growth is huge. It also helped that we have a low entry of RM1 which makes gold saving accessible to all. We have also partnered with a number of partners like Boost and even AeonCredit and we are in the process of onboarding more partner as well as starting a loyalty program,” said Ridwan.
HelloGold also have aspirations that goes beyond Malaysia or even Asia alone. As of right now, it has already launched in Thailand and plans to expand into Indonesia and the Middle East in this year.
It is also set to enter nine countries in the African continent through partnering with digital financial inclusion group, Baobab which has some 800,000 customers. Baobab operates 1140 service points in Africa and has disbursed over RM4.3 billion in loans to the underbanked and unbanked which include micro entrepreneurs, youth and women.
“The potential in Africa is massive given that the World Bank has a goal of Universal Financial Inclusion by 2020 and Africa has been at the forefront with mobile-driven financial inclusion growing by 20 per cent over the past six years,” said Lee.
Lee and Ridwan are looking at the possibility of going beyond gold savings alone within the second half of 2019.
“We are waiting with great interest on what the central bank will announce in regards to the virtual bank guidelines by the end of the year,” said Lee.
“Because we are a nimble fintech company, it will be easy for us to to fulfill that space. Perhaps even faster than a traditional bank would.”
The gold bought on the HelloGold platform is fully allocated where customers completely own the gold they buy.
On purchase, the physical gold is stored in an independent vault in Singapore and customers will also receive an email as well as mobile app, that sets out their transaction details such as the value of the gold in Ringgit, weight in grams, date and transaction ID.