Singapore’s Digital Banks Inch Closer to Profit, Betting Big on Small Business

Trust Bank, GXS and MariBank are cutting losses and shifting focus to SMEs and underserved borrowers, but the fight for relevance in a crowded market is far from over

Singapore’s three digital banks are still in the red — but they’re bleeding less. And for once, that’s good news.

Trust Bank, GXS Bank and MariBank all reported smaller net losses for 2024, suggesting their bets on underserved customers and small businesses may finally be showing signs of payoff. But with the city-state’s banking market saturated and old-school giants like DBS and UOB still towering over them, the road ahead looks anything but smooth.

Smaller Losses, But Still in the Red

Trust Bank, backed by Standard Chartered and FairPrice Group, saw a sharp reduction in its net loss in the fiscal year ending December 2024. GXS, the Grab-Singtel venture, also reported a lower loss. MariBank, owned by Sea Group, likewise showed improvement, even if the final numbers weren’t glowing just yet.

Moody’s Ratings analyst Tengfu Li didn’t sugarcoat the reality.

“Singapore is a tough market,” he said. “You’re dealing with a population that’s already banked and very digital-savvy. There’s not a huge underserved segment — at least not in the traditional sense.”

Yet all three digital lenders managed to make dents in the market. Trust Bank, in particular, emerged as the fourth-largest retail bank by customer numbers as of February 2025, hitting about a million customers. Not bad for a player that launched in 2022.

Chasing New Borrowers, Not Existing Ones

Rather than taking on the big boys head-on, GXS and MariBank are picking their battles — and picking them carefully.

GXS is going after those just entering the credit ecosystem. Think: fresh graduates, gig workers, new businesses.

It’s doing this with products like FlexiLoan, a no-strings-attached personal loan tool that lets users tweak repayment terms as they go. It’s also been busy making deals — like the acquisition of Validus Capital, a local SME financing platform.

MariBank’s approach is tied to its parent company, Sea Group. A big chunk of its lending is happening within the Shopee merchant network — but it’s begun venturing outside that sandbox, too.

In both cases, the goal is clear:

• Find customers traditional banks overlook

• Keep credit risk low through digital tools and early repayments

• Build brand loyalty where incumbents feel… well, boring

The SME Push Isn’t Just a Trend. It’s a Lifeline.

Here’s why digital banks are suddenly so obsessed with small businesses:

Digital lenders argue that with the right tech stack — AI credit models, real-time revenue tracking, invoice-based lending — they can manage SME risk far better than traditional scorecard systems ever could.

And there’s real momentum. Validus, now under GXS, has reportedly onboarded over 6,000 SMEs in just five months since the acquisition, according to a person familiar with the numbers. MariBank, meanwhile, has quietly rolled out its SME lending portal beyond the Sea ecosystem in select regions.

Still, one executive at a large local bank dismissed the optimism: “It’s easy to lend. Let’s see how well they collect.”

Investment Products? Yes. But They’re Not the Silver Bullet.

Digital banks are also trying to diversify income by offering basic investment tools — think high-yield savings, robo-advisory platforms, and in some cases, short-term wealth products.

Trust Bank has rolled out “Trust Invest”, a fractional investing service for retail customers. GXS is in pilot mode for its “Save & Grow” hybrid product that offers daily interest accruals alongside micro-investment suggestions.

MariBank remains more cautious in this space. It’s reportedly testing internal products within ShopeePay before a broader release.

But none of these products — at least for now — are likely to turn the profit switch on.

One fintech consultant put it bluntly:
“This isn’t Robinhood. Singaporeans don’t YOLO their savings into meme stocks. The appetite for high-risk investment products is lukewarm. Digital banks will have to grind it out.”

Credit Risk, Competition, and the Clock Ticking

And here’s where things get tricky.

All three digital banks are facing the triple whammy of:

1. Rising credit costs

2. A still-cautious borrower segment

3. Relentless marketing expenses to keep user growth alive

GXS and Trust have leaned heavily into AI-driven risk profiling, but even smart models can’t beat a sudden downturn. As of Q1 2025, delinquency rates among gig workers and online sellers have ticked up slightly, according to two bank insiders.

Meanwhile, big banks aren’t exactly asleep at the wheel. DBS recently slashed onboarding fees for SMEs and launched same-day digital business accounts. UOB unveiled a partnership with Visa to provide working capital loans with cashback offers.

That’s not “we give up” energy.

So, time’s running out. The Monetary Authority of Singapore (MAS) made it clear: digital banks won’t get a free pass forever. If they want to keep licenses, they need to show solid governance — and soon, sustainable revenue.

One regulator hinted, “We’re not expecting miracles. But we are expecting a plan.”

Can They Win? Maybe. But Not by Playing the Same Game.

There’s still room to play — if they’re creative.

Trust Bank’s success in customer growth suggests that Singaporeans are open to trying something new, especially when it’s tied to retail loyalty points (FairPriceLink anyone?) and slick mobile design.

GXS’s quiet dominance in the micro-loan space hints at a big opportunity that could explode once regional integration happens. It’s already prepping for expansion into Malaysia and Indonesia, according to internal chatter.

MariBank’s Sea-linked ecosystem offers a backdoor into markets like Vietnam and the Philippines without starting from scratch.

So while the Singapore home base might stay tough, the next few years could see these digital banks become springboards into Southeast Asia’s underserved regions — and that’s where the real growth could be.