BEIJING, CHINA – Media OutReach – 18 October 2022 – The cloud-native realtime data warehouse SelectDB recently topped ClickBench which is a global benchmark for analytical databases launched by ClickHouse, showing its high performance in the world. It runs on c6a.4xlarge VM in AWS with 500 GB gp2 by default, surpassing a number of global top products by leading in a lot of indicators.
HONG KONG, CHINA – Media OutReach
– 30 July 2020 – Crowdfunding, which has seen its popularity skyrocket with the rise of high profile platforms the likes
of Kickstarter, GoFundMe and IndieGoGo, has often been hailed as a “democratising
force” in finance, allowing enterprising individuals to launch new and
innovative ventures while bypassing traditional sources of funding they would
otherwise be unable to access. In a recent report, the global crowdfunding
market was valued at US$10.2 billion in 2018 and was forecast to almost triple
by 2025. Clearly, crowdfunding has hit mainstream, but has it lived up to its
promise to give entrepreneurs of all stripes and sorts easier access to
capital?
Conducted by Keongtae Kim, Assistant Professor in the Department of Decision Sciences
and Managerial Economics at CUHK Business School; and Prof. Il-Horn Hann at the
University of Maryland, the study analysed the track record of crowdfunding and
found evidence that pointed to its potential to level the fundraising playing
field for entrepreneurs. However, this result came crouched in an important
caveat — it found that people who lived in areas with lower levels of income
and education were less able to take advantage of it to launch projects.
The study arrived
at this conclusion by focusing on one of the most important types of credit for
entrepreneurs — bank financing through housing collateral, looking at how
accessibility to these loans related to crowdfunding by entrepreneurs. Prior
studies had already shown that housing wealth can ease credit constraints for
entrepreneurs, making it a primary factor in financing new ventures.
The researchers
obtained data on housing prices and matched this with a data set from
crowdfunding platform Kickstarter. They focused on local housing prices as a
proxy for collateral-based credit availability for entrepreneurs in a local
market. If entrepreneurs living in areas with declining housing prices have an
increasing degree of difficulty in raising sufficient capital, they may be
inclined to use crowdfunding as an additional funding source.
The professors
focused on technology-based projects in the technology and games categories,
obtaining data covering April 2009 through December 2013 and accounting for
9,120 projects that attracted more than US$257 million in pledges from
approximately 3.4 million contributors.
Impact of Housing Prices
“We found
that tightened credit constraints imposed because of declines in local housing
prices led to increased use of crowdfunding. This finding supported the idea
that crowdfunding serves as a supplement to traditional sources of financing,”
says Prof. Kim.
“We also observed
that a decline in housing prices led to even more people turning to
crowdfunding in areas with a large share of homeowners and in states with
unlimited homestead exemptions,” he adds. Homestead exemptions are legal
provisions that shield homeowners from partial or full seizure of their
properties in the event of a default, and previous studies have shown that
banks are less willing to lend to individuals in states with high or even
unlimited homestead exemptions.
“Our
research indicated that crowdfunding can serve as an addition to traditional
financial sources, implying that online crowdfunding has the potential to
democratize access to finance in the sense that it can be an option for
entrepreneurs who have difficulty accessing traditional funding,” Prof.
Kim says.
The researchers
did not find a link between a fall in housing prices and whether a crowdfunding
project was successful or not.
However, they
also found a stark contrast in the ability to access capital using crowdfunding
between the wealthier and the poor. Specifically, they observed that a decrease
in housing prices led to an increase in successful crowdfunding projects
primarily for areas in high socio-economic status and an increase in
unsuccessful projects primarily for areas of low socio-economic status.
“Although
entrepreneurs from areas of low socio-economic conditions have at least equal
access to online crowdfunding, they may still suffer from lower demand for
their projects. This may be partly because of less support of their social
networks,” Prof. Kim says.
“The role of
access to financing is essential as difficult access discourages
entrepreneurship, as measured by self-employment surveys and census data, and
entrepreneurship is very important,” he adds.
In the U.S. alone,
small businesses employ more than 50% of the private sector workforce and
account for 66% of all net job creation. Most jobs are created by young,
typically small businesses. High-growth start-ups contribute significantly to
job creation in the U.S. economy.
Leveling the Crowdfunding Playing Field
Crowdfunding has
the potential to offset a decrease in entrepreneurship. “However,
entrepreneurs need to be strategic in seeking funding from sources that may be
favourable to them,” cautions Prof. Kim
The study showed
that while decreasing housing prices made banks reduce credit supply to
entrepreneurs in need, crowdfunders were still willing to back them. “Entrepreneurs
living in disadvantaged areas should exploit crowdfunding aggressively and
attempt to build upon their social networks or improve their projects for
successful funding,” he says.
“To help
entrepreneurs from disadvantaged areas in achieving real economic benefits from
crowdfunding, we must understand its underlying mechanisms,” says Prof.
Kim.
He advises that
policymakers should seek to implement policies to help entrepreneurs from areas
of low socio-economic status to obtain sufficient resources to raise money from
online crowdfunding successfully.
A shortfall of
their research, he concedes, was that though their ad hoc analysis suggests
that social networks play a considerable role in the socio-economic divide,
they could not explore this in a meaningful way due to data limitation.
According to the
professor, another limitation was that their study focused only on
technology-intensive projects, meaning that they have a limited ability to
discuss crowdfunding in other types of projects.
“Although we
recognise that bank financing and crowdfunding offer different funding
conditions in terms of funding duration, success rates of funding, interest
charges, and so on, the two channels considerably overlap,” concludes
Prof. Kim, adding that a significant number of creators are potentially able to
use both channels and choose the optimal combination that offers the best terms
and conditions.
Reference:
Keongtae Kim,
Il-Horn Hann (2019) Crowdfunding and the Democratization of Access to Capital —
An Illusion? Evidence from Housing Prices. Information Systems Research
30(1):276-290. https://doi.org/10.1287/isre.2018.0802
This article was first published in
the China Business Knowledge (CBK) website by CUHK Business School: https://bit.ly/3hcehWv.
About CUHK Business School
CUHK Business School comprises two schools — Accountancy
and Hotel and Tourism Management — and four departments —
Decision Sciences and Managerial Economics,
Finance, Management and Marketing. Established in Hong
Kong in 1963, it is the first business school to offer BBA, MBA and Executive
MBA programmes in the region. Today, the School
offers 11 undergraduate programmes and 20
graduate programmes including MBA, EMBA,
Master, MSc, MPhil and Ph.D.
In the Financial Times Global
MBA Ranking 2020, CUHK MBA
is ranked 50th. In FT‘s
2019 EMBA ranking, CUHK EMBA is
ranked 24th in the world. CUHK Business School has the largest
number of business alumni (37,000+) among
universities/business schools in Hong Kong — many of
whom are key business leaders. The School currently has about
4,800 undergraduate and postgraduate students and Professor Lin Zhou is the Dean of
CUHK Business School.
The payment platform will allow businesses in Hong Kong to make payments with credit cards in instances where the recipients do not accept card payments.
CardUp’s solution will help Hong Kong-based businesses maximise and digitise their cash flow, access flexible and competitively-priced capital during the current economic climate, whilst equipping businesses with the tools to automate their payables processes
CardUp is a registered Visa Business Payment Solution Provider (BPSP); this partnership enables customised pricing for Visa Commercial card holders at competitive rates
HONG KONG SAR – Media OutReach – 4 December 2020 – CardUp, the digital credit card enablement platform, has launched their solution that enables local businesses to pay any non-card accepting recipients by credit card, even when cards are not accepted. This launch coincides with CardUp’s partnership with Visa as a registered Business Payment Solution Provider (BPSP) that enables Hong Kong-based businesses to maximise their cash flow by tapping onto existing credit card lines at customised rates.
As a Visa-registered BPSP, CardUp can help more businesses in Hong Kong tap onto their underutilised credit limits, allowing businesses to leverage their credit cards for payments at a competitive price and customised rate. To enable card payments in places where cards are not accepted, CardUp charges a processing fee.
“We are delighted to expand our services to businesses in Hong Kong, many of whom grappled both with cash flow problems and challenges digitising payables and receivables whilst finance teams work digitally in the new post-pandemic world. We saw an opportunity to help them with a more flexible digital business payment facility to enable their business continuity,” said Nicki Ramsay, CEO of CardUp. “By launching our platform in Hong Kong, we enable businesses here to tap onto existing credit card lines more easily to help them tide their cash flow during this uncertain time. Our collaboration with Visa allows us to double-down on this flexibility as our BPSP facility is competitively-priced, more convenient than using conventional credit lines and quicker as there is no need for applications or waiting times.”
A survey by the Hong Kong General Chamber of Commerce (HKGCC) found that 42 percent of small- and medium-sized enterprises (SMEs) and 24 percent of large corporations were concerned about their survivability amid the ongoing COVID-19 pandemic[1]. During this time, these businesses were particularly exposed to reduced short-term cash flow due to revenue losses. CardUp believes that its new B2B facility and its status as a registered Visa BPSP will help the businesses benefit from more flexible payment options to keep their businesses afloat during uncertain economic periods.
“Many businesses often think of a credit card as nothing more than a payment method. However, a business credit card can also double up as a planning and budgeting tool. Based on our research, Visa recognised that cash flow optimisation is one of the top pain points of Hong Kong SMEs,” said Maaike Steinebach, Visa General Manager, Hong Kong and Macau. “Our partnership with CardUp helps businesses extend their days of payable outstanding and optimise their working capital with their commercial cards, crucial under current business climate.”
As a registered Visa BPSP, CardUp provides the following payment facilities for both businesses and banking partners.
For businesses
Enable B2B payments on credit cards. CardUp allows businesses to use their credit cards to pay business expenses to non-card accepting recipients, which includes payroll, supplier invoices, rent and more.
Improve cash flow. Businesses can improve their cash flow by using CardUp’s platform to obtain up to almost two months of interest-free credit and early settlement discounts. This solution, coupled with competitive rates presented by their status as a Visa BPSP, presents an extremely cost-effective way for companies to access working capital. It is also much easier for them to obtain these funds, without any lengthy and cumbersome applications or heavy documentation required for loans.
Digitise processes. CardUp provides businesses a digital interface where they can schedule recurring payments and monitor payment statuses all from one dashboard — allowing them to easily leverage data to track and reconcile payments. CardUp’s platform also equips businesses with invoice automation tools to digitise payables and receivables processes, helping finance teams work digitally and thrive in the new normal.
Cost and time savings. Businesses enjoy additional cost savings through card rewards earned on these business expenses, as well as time and cost savings through the automation and consolidation of domestic and international payments on one platform.
For banking partners
Obtain more customers and business growth prospects. Banks and payment networks can benefit from increased coverage, capturing incremental spend in non-card accepting sectors, as well as advance digitisation efforts. With over US$1 trillion still being spent by cheque in Hong Kong, this opens up opportunities in the cards sector as businesses are able to use their heavily underutilised credit limits for large business expenses previously not possible by card.
CardUp’s technology connects to accounting and ERP platforms, to provide businesses with seamless data flow and reporting. This provides a solution that enables any payment made by bank transfer or cheque to be shifted to cards — regardless of whether the end-recipient accepts card payments.
CardUp already collaborates with all major banks in the region such as Citi, DBS and UOB. Outside of Hong Kong, the company has already made its digital platform available in Singapore (where it first launched) and Malaysia and has managed hundreds of millions of dollars in payments today to vendors globally. The company is currently seeking opportunities to expand its digital platform across the region to give more businesses in the region and alternative, digital payment facility to better manage their cash flow.
CardUp is a credit card enablement platform that brings value to both individuals and businesses by improving the way they pay and get paid, access credit and manage payments.
The company started by allowing any big expense previously made by bank transfer, cheque or cash to be shifted to card, even where cards are not accepted. Examples include rent to a landlord, insurance premiums, payroll, supplier invoices and more. CardUp has since gone on to launch merchant card solutions, card enablement APIs and payment automation tools that help SMEs save time and automate their finance processes.
CardUp manages hundreds of millions of dollars in payment volume in the region today. The company continues to innovate in technology across business financing, payment automation, data insights and card rewards, to deliver their vision to unlock the benefits of card payments for everyone. As of 2020, CardUp operates in Singapore, Hong Kong and Malaysia.
