kopi-C with GXS Group CEO: GXS Bank’s blueprint for scale, profitability and purpose

When GXS Bank’s Group Chief Executive Officer Lai Pei-Si bought her first home early in her career, applying for a renovation loan was a key part of the experience that she still keenly recalls.

Borrowing S$27,000 from a bank to fund the renovation was a necessity – after already spending most of her money on buying the house – but the process was far from ideal.

“I had to take the S$27,000 upfront and incur interest from day one,” she says. This was even though contractors only required payment after renovation milestones were met, meaning that it would have been preferable to draw down the capital in phases.

At the same time, paying off the loan early would also incur penalties.

“It was quite surprising to me that when we looked at renovation loans, we realised after 30 years it hasn’t changed much,” says Lai who took on the role of Group CEO in June this year.

Such inefficiencies are areas where Lai sees an opportunity for GXS Bank to differentiate itself and win customers over. “For us to win the market, to be able to differentiate, we truly have to solve their problems,” she says.

Ecosystem integration as a differentiator
 

Leveraging technology and data while being anchored to a broad ecosystem has been an important part of the Group’s strategy to gain a foothold in the competitive banking industry.

“The industry is very well-served in many areas. However, our unique advantage is that we are part of an ecosystem that serves millions of Singaporeans. It was very clear to us that our business model had to have the ecosystem at the core,” Lai says.

Founded in 2020, GXS Bank – a 40:60 joint-venture of Mainboard-Listed Singtel, and Nasdaq-Listed Grab – is one of four digital banks in Singapore that was awarded a banking licence from MAS, and it has been on the path to build out its services since.

“It was quite surprising to me that when we looked at renovation loans, we realised after 30 years it hasn’t changed much.”

Apart from the Singapore bank, the Group is also present elsewhere in the region with its subsidiary GXBank in Malaysia, and Superbank, an Indonesian digital bank in which GXS Bank has a minority stake. Grab and Singtel are also shareholders in Superbank. Since launching in Singapore (2022), Malaysia (2023), and Indonesia (2024), GXS Group has rapidly grown its user base, reaching millions of customers across these markets.
“Many of our customers sign up with our digital banks through the ecosystem, and many of them stay with us also because of the ecosystem,” Lai observes, adding that a key opportunity lies in the unmet needs across the various markets.

For instance, about 80 per cent of Indonesia's market and 55 per cent of Malaysia's are underserved, while Singapore has a smaller but distinct underserved segment, including gig economy workers and micro-SMEs lacking credit bureau records.

GXS Bank aims to provide credit and banking services to customers with limited or no credit history by leveraging alternative data, such as ecosystem data, to enrich credit models and manage risk.

“Our technology enables us to start small, because the cost of service is lower,” Lai says. Being embedded in an ecosystem also provides the bank with data that helps it with credit and risk innovation to differentiate itself in the market.

Embracing innovations that serve its consumer and business customers’ needs will be important to drive success for the bank, amid the competitive landscape.

In the context of renovation loans, for example, the Bank’s GXS FlexiLoan is designed to enable customers, who have obtained approval for the loan quantum, to draw down only the capital they currently require. Early repayment also does not incur any penalties.

“We took the same traditional product and changed the product features in a way so that it actually solves a problem,” Lai says. “If we are very thoughtful of the problem that we are trying to solve with the technology of today, and with our intention to always do the best for the customer, we will be able to come up with new things.”

Achieving scale and profitability

Over the past five years since GXS Bank was founded, the group has been on a mission to build up its product suite.

Prior to taking on the role as GXS Group CEO, Lai headed up the Malaysian subsidiary GXBank for 3.5 years.

“We built three banks in two years… building from zero to one to ensure the foundation is there,” she says, adding that this prepares the group for further growth.

The Group has experienced some initial success in getting customers to embrace its products. Since launch, it has crossed over 5 million customers across Indonesia, Malaysia and Singapore, but Lai sees this as just the beginning.

“Our team will say that 2025 and 2026 is about scaling,” Lai says. “Scaling to 10 times of where we were before.”

As part of its growth strategy, GXS Bank has also been exploring acquisitions and partnerships that expand its capabilities. In April, the Group acquired fintech company Validus Capital – one of Singapore’s largest digital lending platforms for small- and medium-sized enterprises (SMEs).

The acquisition has expanded the bank’s product capabilities for SMEs ranging from working capital loans to trade finance.

“If we are very thoughtful of the problem that we are trying to solve with the technology of today, and with our intention to always do the best for the customer, we will be able to come up with new things.”

Lai continues to see opportunities for GXS Bank to partner other like-minded fintechs, and those that are most attractive would be those that provide complementary capabilities, as well as ecosystem access.

“Imagine if you have a partner that has as big as an ecosystem like what we have with Grab and Singtel. The potential for both parties to amplify our reach will be immense. That would be another big thing that we will look at,” she says.

A key ambition for GXS Group in the coming years is to be able to break even.

In its FY24 ended December, GXS Group (which comprises GXS Bank and GXBank) generated total income of S$32.1 million, around double that of the previous year. Its net loss for the year rose slightly by 2.9% to S$214 million, largely due to prudent credit reserves on the lending activity as the Group fortifies its balance sheet for future loan growth. Its operating costs remained relatively flat year on year.

The group is aiming for both topline growth and cost efficiencies to reach its goal of profitability. After spending the past few years building up its regional technology, data and product suites, most of the bank’s infrastructure is already in place, and costs are expected to have peaked.

“It's not going to be easy,” Lai acknowledges. “But it's something that we have taken on a challenge because we want to have a sustainable business.”

Leading through challenges

Before joining the GXS Group, Lai was a veteran banker at Standard Chartered Bank for over two decades, holding senior leadership roles.

“I've seen how being able to have access to education (or) financial support actually changes the lives of yourself and the next generation.”

Leaving an established senior position to build and scale up a new bank may not be everyone’s cup of tea, but Lai notes that the ability to start from a blank sheet was what attracted her.

“You get to change and make a difference. The impact is even greater and faster, because you have no shackles, and no legacy,” she says.

The ability to build a business that caters to underserved segments also resonated. Growing up as a daughter of a schoolteacher mother who taught in a small Malaysian town, Lai had seen first-hand the impact of helping others.

“We used to foster kids in my home, so besides the four of us – I've got three other siblings – there were always other kids at home,” she says. “I've seen how being able to have access to education (or) financial support actually changes the lives of yourself and the next generation.”

Even so, building a bank from scratch has not been easy, and Lai acknowledges that there is no such thing as a crisis-free day.

“I was the first employee for GXBank, and I needed to set up my team, and I actually thought that I knew how to build that having been in banking for so many years,” she recalls. “But I couldn't do it on my own. You do need the right set of people with the right mindset and the right competencies.”

As the leader of a large organisation, clarity remains a key focus, and Lai still closely follows advice that was once shared by a mentor, whenever she takes on a new role.

“When I take on a new role, I write a farewell speech that I will deliver if I were to actually leave that role. What it really does is almost gives me a compass on what I want to achieve,” she says. “That was the best, best, best advice I've ever had.”

Just three months into her current role as GXS Group CEO, the farewell letter is still in the process of being penned, but Lai is already thinking of the words that she wants on that page.

“I want to be proud of the organisation, and the organisation that we've built has to be able to withstand and to be able to accommodate changes, because change is a constant,” she says.

“I want us to be The Digital Bank in Southeast Asia.”

Related links:

• Simple and fuss-free investing: A look at GXS Invest

• GXS Savings Account review

• Best savings accounts in Singapore

About GXS Bank

GXS Bank is a digital bank focused on making banking better for the everyday consumer and businesses.

The Bank aims to improve financial inclusion and to drive financial revolution for its customers through the secure and ethical use of technology and data.

GXS Bank holds a banking licence issued by the Monetary Authority of Singapore. It is owned by a consortium consisting of Grab Holdings Inc. – Southeast Asia’s leading super app, and Singtel – Asia’s leading communications technology group.

As part of a regional network of digital banks, GXS Bank also works closely with GXBank, its digital bank subsidiary in Malaysia and Superbank, a digital bank in Indonesia.

For more information, please visit https://www.gxs.com.sg/.

About kopi-C: the Company brew
 

kopi-C is a regular column by SGX Research that features C-level executives of leading companies. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations.

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