Investments

ADDX lists private credit fund managed by Helicap Investments to promote financial inclusion in South-East Asia

Since 2018, the flagship Helicap Fund I has disbursed more than USD100 million in loans and has achieved a net return of around 10% on an annualised basis.

Helicap Investments has listed its flagship fund, Helicap Fund I, on the private market exchange ADDX to improve financial inclusion for underserved individuals as well as micro- to small- and medium-sized enterprises in Southeast Asia, and to empower partner institutions to transform the way consumers and SMEs access credit. Since the launch of the fund in 2018, it has disbursed more than US$100 million and its historical performance has been around 10% in net annualised returns.

With the efficiencies that result from ADDX’s blockchain and smart contract technology, the fund was offered to approved investors on ADDX’s platform at a minimum size of US$10,000.  Investors who subscribe to private credit funds like Helicap through traditional, non-tokenised channels generally face minimum investment sizes of USD250,000 or more.

Helicap announced a strategic funding round last month that saw Temasek-backed international alternative asset management group Tikehau Capital join Helicap as a shareholder. In 2020, Helicap raised USD10 million in a Series A funding round led by Saison Capital, the corporate venture arm of Japanese consumer finance firm Credit Saison. It previously raised US$1.5 million in seed funding from Nufin Data, a fintech trade financing firm chaired by Teo Ser Luck, former Singapore Minister of State for Trade and Industry.

Helicap has developed a proprietary technology that focuses on risk management by crunching millions of loan data points to evaluate the creditworthiness of more than 500 digital lenders and businesses across SEA and Oceania, and the group provides curated access into the private placements space in SEA while financially enabling underbanked individuals and enterprises across the region. The software analyses data that is detailed to the level of how each microloan that reaches an end-borrower is performing.

These end-borrowers are underbanked individuals and companies – for example, an entrepreneur in Jakarta needing financing for a motorcycle to make deliveries around the city, or a businessman in Manila who wants to start a grocery shop.

The rising global inflation and correction in public markets this year have made private markets an alternative for portfolio diversification. Private debt markets have shown a low correlation to public markets and can provide positive risk-adjusted returns when robust risk management frameworks are applied.

 

ADDX Chief Executive Officer Oi-Yee Choo said: “Microlending companies are tackling a real problem that traditional lenders have not been able to solve because they haven’t built the granular knowhow and infrastructure for it. Microlenders are putting funds in the hands of creditworthy individuals and small businesses, bringing about financial inclusion which translates into more jobs, more people having access to education and higher living standards. Helicap is on a mission to power these microlenders by providing them with lending capital. The company’s mission of improving financial access for underserved customers ties in perfectly with ADDX’s own mission of democratising the private markets. We are therefore excited to list Helicap’s flagship fund. The private credit market has more than doubled in size since 2015 and is now worth more than US$1 trillion worldwide. For investors who want exposure to this large and burgeoning asset class, a fund manager’s ability to manage the risk from non-performing loans is vital. The technology Helicap has built to evaluate microlenders is sophisticated, ensuring microlenders that borrow from Helicap are building a sustainable business. The fund’s record of zero defaults by microlenders since its inception stands out within the space.”