Vietnamese conglomerate TTC Group, digital financing platform Validus, and investment fund Do Ventures have formed a joint venture to drive financial inclusion and the growth of small and medium-scale enterprises (SMEs) in Vietnam.
The joint venture underscores the commitment of all parties to advancing SME growth in Vietnam and creates multiple synergies – one of which is TTC’s large ecosystem of SMEs across the energy, real estate, cane sugar, and hospitality industries in the country, according to a press statement.
While SMEs play a pivotal role in Vietnam’s economy, access to credit remains a pressing issue, with the SME financing gap standing at 12% of the country’s gross domestic product. According to a World Bank survey on the impact of Covid-19 on firms in Vietnam, about 50% of firms have under three months of cash flow and over 60% have reported some difficulties in accessing funding.
TTC Group is participating in the venture through its DHA Corporation (DHAC), which invests in real estate, health and sports.
Dang Hong Anh, TTC Group vice chairman and DHAC chairman, is also chairman of the Vietnam Young Entrepreneurs Association, which has more than 9,000 members and 66 chapters across the country. With his participation in the venture, SMEs will benefit from access to relevant parties in a closed loop where business interactions become more powerful and speedy, the statement says.
Meanwhile, Do Ventures’ expertise in the emerging fintech landscape in Vietnam will be a strong support for Validus Vietnam’s growth ambitions, and the JV will benefit from potential synergies with Do Ventures’ portfolio companies.
Since its launch in 2015, Validus has disbursed over US$1 billion in SME loans across Singapore, Vietnam, Indonesia and Thailand. The company is backed by highly reputed VCs including FMO, Vertex Growth, Vertex Ventures Southeast Asia and India, AddVentures by SCG, K3 Ventures, Openspace Ventures and VinaCapital Ventures.