You are at Watson's and ready to pay for a bottle of fish oil supplement. You have credit cards, debit cards, e-wallets like DBS Paylah!, GrabPay, Singtel Dash, etc.

You also have a Watson's mobile app to receive membership points.

Whichever method you choose to pay with, and collect reward points, is processed without a hitch.

The payment solutions provider for Watson's is OxPay Financial.

Or if, from the comfort of home, you go online, place orders and pay. Your payment -- even if it's cross-border -- would be processed by OxPay's solution.



oxpay top4.24
OxPay is 
the only payment solutions provider listed on the Singapore Exchange, and counts some 4,000 merchants as clients -- mainly in Singapore and the rest in Malaysia and Thailand.

It has various licences including, of course, those issued by the Monetary Authority of Singapore.

The payment sector is highly regulated, and licenses take a long time to be awarded, serving as high barriers to entry to the sector.

oxpay clients4.24

Brief history 
• MC Payment was established in 2005.

• MC Payment became a listed company on the Singapore Exchange in Feb 2021 through a reverse takeover of Artivision Technologies.

• MC Payment changed its name to OxPay Financial in Sept 2021.

It's not just the likes of Watson's -- or Old Chang Kee and Q&M Dental -- that OxPay processes payments for -- and gets a small percentage in fees which OxPay reports as its revenue.

There are also small businesses and, overall, it's the volume of transactions processed which matters to OxPay's business model.  

Its FY2023 revenue amounted to S$8.3 million (-16% y-o-y). Net loss was S$1.9 million.

This suggests a highly competitive and mature market, which Singapore is.

Singapore has been where OxPay derived the bulk of its revenue -- Singapore accounted for 83% of FY2023 revenue. 

Under a new CEO -- Yick Li Hsin, who was appointed in January 2024  -- OxPay is attempting to get a leg up in new markets.

Notably, it is venturing into other related businesses for the first time (more on this below).


While the likes of Watson's are businesses with annual revenues in the millions of dollars there are also the so-called Tier 3 and Tier 4 businesses which collect, say, less than S$20,000 a month. 

From 2024, OxPay is targetting to acquire more of these small fries in a new market -- Indonesia -- and in existing markets of Malaysia and Thailand.

Stock price 

5 c

52-week range

4 – 9.1 cts

Market cap

S$14 m

PE (trailing)

--

Dividend yield (trailing)

--

1-year return

-43%

Shares outstanding

276 m

Source: Yahoo!

This can be done through partnerships and acquisitions. 

"Singapore has about 200,000-300,000 merchants while Indonesia has about 20-plus million. A huge number are the mom-and-pop shops," says Mr Yick in an interview with NextInsight.

"We have the potential to work with them. As a fintech company, we try not to directly compete with traditional banks but to reach out to this underbanked and unbanked population."

That's where the vast growth potential lies but there is also a new field that OxPay is on the verge of venturing into -- issuing credit cards.

Issuing Diners cards in Indonesia


OxPay, which counts Oxley Holdings' executive chairman and CEO Ching Chiat Kwong as its controlling shareholder and non-executive chairman, is targetting new milestones.

Following a proposed investment announced in November 2023, OxPay is close to sealing a deal to invest in PT Diners Payment Indonesia, a company mainly engaged in being the agency for Discover and Diners Club network in Indonesia.

"We're looking to go into Indonesia very strongly -- first by acquiring the Diners franchise so we are able to have the entire payment license short of a bank licence. That means we are able to do merchant acquiring, remittance, money exchange, etc," says Mr Yick.

"The most important thing is we want to be able to start issuing cards in Indonesia. This is an entirely new business vertical for OxPay," he adds.

Shawn Ching, Non-Executive Deputy Chairman of OxPay, says it's potentially a lucrative business: "We collect a fee when any
 Diners card in Indonesia is swiped for payment, and we also make a fee when anybody rolls over his debt."

To support this card-issuing business, OxPay will need a bigger balance sheet and a credit risk modeling. 



Another 2 promising new ventures:

DinersClub4.24DCS has been an exclusive franchisee in Singapore of Diners Club International since 1973.• In March 2024, OxPay entered into an agreement with DCS Card Centre (formerly known as Diners Club Singapore) to be their payment facilitator.

The agreement allows OxPay to process transactions on credit cards and charge cards, as well as international transactions -- the latter service was interrupted in 2023 -- through Visa, Mastercard, Diners Club International and China UnionPay.

• In December 2023, OxPay SG also entered into a collaboration with Green Link Digital Bank. 

This is a licensed wholesale digital bank in Singapore, providing banking, supply chain financing and working capital financing services to business enterprises in Singapore.

Through the collaboration, OxPay hopes to tap opportunities to acquire merchants and provide credit facilities to them as well. 

By doing so, Oxpay hopes to increase the stickiness of the merchants and stand out in a very competitive merchant-acquiring market.


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