Having raised a total of S$56 million (US$40 million) since its founding in 2017 – the last round of S$35 million happened last year, YouTrip, which wants to be a borderless banking platform serving the needs of businesses and travellers in South-east Asia, is coming out strong from the pandemic, launching YouBiz, targeted at SMEs, with Mastercard, and coming soon, travel insurance.

“From the start, we wanted to build a borderless banking product for travellers in the region, one that would allow them to do foreign currency conversions at real-time competitive rates, and make it convenient for them to pay when they travel,” said Caecilia Chu, co-founder and chief executive.

She’s not wavered from that mission, despite the pandemic wiping out 70% of business during the darkest days. In fact, the past two years have probably made the company more resilient and determined to pursue its goal of becoming the leading financial product for travellers in South-east Asia.

"The pandemic has brought out our determination to be an all-weather company," says YouTrip's Caecilia Chu.

The beginning of YouTrip

In 2017 when Chu and her co-founder and CPO Arthur Mak, came from Hong Kong to explore the idea of launching a fintech startup in Singapore and South-east Asia, they realised that "the market was very fragmented – it’s not one big country with one major currency. Everybody has to use different currencies and travellers would carry wallets full of different notes and coins.”

Studying the problem, they asked, “what if we built a borderless banking product?”

“We felt that if we could help customers solve the foreign currency conversion fees and give them the convenience of making payments, we thought they’d love us.”

Hence their first product was YouTrip, a multi-currency travel wallet (linked to Mastercard) and money changer in one app. Today, one in five Singapore millennials carry the YouTrip card and it is the number four consumer debit card issuer in Singapore, said Chu.

With travel reopening, the company, which has a staff strength of around 130, is seeing business volumes double in the past three months. “Between March and May, we are doing four times what we did in 2021,” she said.

“Travellers feel safer with our card, especially when travelling to less familiar places. It allows you to control what you store in it – it does not link directly to your bank account. It allows you to exchange currencies real-time and it works anywhere, across 60 million merchants and ATMs that take Mastercard,” said Chu. The card also offers peer-to-peer transfer allowing friends to split bills on the spot.

Asked how it is able to offer competitive exchange rates, she said, “We built our payment infrastructure in Southeast Asia for Southeast Asia. For Asian currencies, our rates are systematically better and we give the rates away to the consumer. We don’t make money on currency conversion.”

Where it makes money on is from transactions and the merchant fee – it gets a cut from its credit card partners.

Cashback directly into travellers' wallets

Last year, it launched YouTrip Perks, a cashback programme. “We saw that the top transacting agents on our platform were travel brands – Agoda, Booking.com as well as Lazada and Shopee,” said Chu.

It offers up to 12% cashback when consumers buy from those brands on YouTrip. That cashback automatically goes into the consumer’s wallet. “This has really driven a lot of transactions,” said Chu.

During the pandemic, when travel stopped, YouTrip expanded its Perks programme to cover products and services that consumers, staying home, were spending time on – such as education, gaming, self-improvement and general e-commerce – a move that helped the company tide through the difficult days.

That pivot helped it grow its millennial consumer base in Singapore. “So it wasn’t wasted,” she smiled. “Pre-pandemic, we were reliant on travel spend. Now shopping and travel are growing together.”

YouBiz will “enable SMEs to build borderless businesses”

It was also during the pandemic when work habits changed that the company sensed another opportunity – a product targeted at corporate travellers, especially from SMEs who have emerged into a new world of remote work and changed workplaces. It launched its corporate travel product YouBiz in partnership with Mastercard.

“In the consumer world, by regulations, you can only deposit S$5,000 (US$3,600) in your wallet – so there is a spending limit. So it’s not practical for business travellers. With corporate cards, there is no limit. It’s powered by the same infrastructure so we will offer zero FX fees and we will give one percent uncapped cash back on all spend,” said Chu.

Chu believes it will empower SMEs to build borderless businesses. “The way we work has changed. The need for multi-currency operations will only increase. Now companies realise they can hire talent from anywhere, can put up digital storefronts and sell from anywhere, can work with vendors anywhere. In the next five to 10 years, banking also needs to be more borderless.”

With YouBiz, SMEs will also have the option to get credit. “Corporate credit card penetration is low in Singapore – there are about 80,000 to 90,000 corporate credit cards but there are 300,000 SMEs, so there is a market gap.”

Next in line is insurance products, which will launch in a couple of weeks in partnership with Hong Leong Assurance. Seeing travel insurance as an opportunity, it applied for a licence in April. “We are now licensed as an insurance agency and can sell any insurance. We want to start with travel, it’s on trend, it’s on people’s minds.”

Given it already has a healthy user base and will not incur any additional customer acquisition cost, Chu said, “We will give some of the savings back to the customer and use some of our commission income to subsidise the sale.”

She said the plan is to offer a fuller suite of financial products and put them on one single platform.

Growing, one country at a time – “we are not a superapp”

Because of the fragmented multi-currency market in South-east Asia, and the various banking regulations, YouTrip has had to build, one country at a time. It took on Singapore first, then launched in Thailand in 2019. It will launch in Malaysia in a few months. Each market launch is done with a local partner – in Singapore, its partner is EZ-Link, and in Thailand, it’s Kasikornbank (Kbank).

It targets outbound travellers in each market because it can only serve the residents of each country. Chu said that while this can make it harder to scale the business globally, that is precisely the opportunity – to go really deep in each local market, something global competitors (such as Revolut) cannot do.

“We can do this, solve the fragmentation problem, one by one because we just do this. We are not an OTA trying to do fintech, we are not a superapp, we do not want to be a superapp, you won’t see us selling airline seats or deliveries. We are focused in expanding our suite of financial products.”

She said that if anything, the pandemic helped crystallised its purpose – to solve the fragmented multi-currency problem by creating a borderless banking product.

“Our mission statement is to create payment innovation and give customers the best value, utmost convenience and great reliability. As an Asian company, we care about costs. Whatever shiny thing that comes along is good but if you can help me save money, even better.”

Source: WiT