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By Anshuman Daga
SINGAPORE (Reuters) -Standard Chartered Plc announced a 10-year fintech partnership with Singapore-based Atome Financial on Wednesday to help it grab a piece of the booming buy now, pay later market in Asia that has thrived during the pandemic.
The global boom has boosted providers including Klarna, Affirm, Afterpay and Paypal, but has led to greater scrutiny by regulators concerned that consumers do not take on more debt than they can handle.
Standard Chartered, the first major bank to unveil a significant foray in the sector in Asia, is making an undisclosed equity investment in Atome Financial, which operates the Atome platform in markets including Southeast Asia, and Indonesian digital lending platform Kredit Pintar.
"This marks one of Standard Chartered's largest strategic investments in a fintech to-date and supports its ambition to expand its reach and scale within the mass market segment via a digital-first approach, underpinned by digital acquisition and new partnership models," a joint statement said.
Unlike Western markets where there is easy availability of credit, many consumers in developing countries, such as in Southeast Asia, do not have not much access to credit and lack bank accounts.
Standard Chartered said it will also provide financing of $500 million to support Atome Financial expand its group of merchants and customers.
The tie-up will initially launch in Southeast Asia, rolling out to include buy now, pay later services in Indonesia, Malaysia, Singapore and Vietnam in the next few months. It will then expand into digital lending products, the companies said in their statement.
"This will allow us to aggressively scale credit products to small businesses and retail customers, including buy now, pay later," Standard Chartered's CEO Bill Winters said at an event in London while giving an update on the bank's digital strategy
The fintech firm's other markets include China and Taiwan. Atome Financial is part of Singapore-headquartered tech start-up Advance Intelligence Group.
(Reporting by Anshuman Daga in Singapore and Nikhil Kurian Nainan in Bengaluru; Editing by Christian Schmollinger, Elaine Hardcastle)