These days everyone wants to be a super app from bigtechs to banks and even an airline company like Air Asia.

It’s easy to see why, the allure of being able to deliver a plethora of services through a single app and creating a sticky value proposition for your users are certainly compelling reasons for companies to be drawn towards building super apps.

The most recent addition to the list is Malaysia’s largest independent investment bank Kenanga Bank. In a closed-door media session, the bank revealed that they are targetting to launch a digital wealth super app by the first quarter of 2023.

Kenanga Bank seems to have been building towards this goal for some time now, from the launch of their digital-only equities brokerage Rakuten Trade to the launch of their robo-advisory platform Kenanga Digital Investing (KDI) and the series of investments in companies like Merchantrade, CapBay, and Tokenize Exchange.

“We have dedicated years in building our business in stock broking, futures, asset management, investment banking, More recently we have collaborated with digital partners like Rakuten, CapBay, Merchantrade, Tokenize to expand our digital product offerings. The beauty now is to integrate all our products and solutions onto one single platform, one ecosystem that will transform how Malaysian view and approach wealth creation,” Datuk Chay Wai Leong, Group Managing Director, Kenanga Investment Bank

The investment bank intends to house all their digital wealth services under the soon to be launched super app.

This includes services like stock trading, cash management products, robo-advisory, P2P financing, cryptocurrencies, IEO, and more. The app will also feature an e-wallet function as well, which comes with a pre-paid card and is powered by Merchantrade.

Housing all these services under a singular super app will definitely make cross-selling of their various wealth products more seamless and they are likely to find success in markets where they already have a proven track record.

For example, Rakuten Trade which was launched in 2017 has already seen over 250,000 users with over RM 3.5 billion assets under management (AUM), and KDI which was launched in February crossed the RM 100 million AUM mark within two months and is currently managing over RM 200 million AUM.

However, whether they will find the same success in the cryptocurrency space remains to be seen, at the time of writing we are in for what is predicted to be a long crypto winter.

In addition to that, within the local regulated crypto exchange space, Luno still dominates the market with the last reported number of customers exceeding half a million. Hardcore crypto enthusiasts who are both anti-establishment and anti-banks are unlikely to want to put their invest in crypto through a bank’s superapp.

Though, all hope is not lost, if Kenanga takes inspiration from DBS, it may yet find its path to success. DBS’ crypto exchange DDex exceeded SGD 1 Billion in trading value within its first year of operation.

They have done so via a membership-only business model where it provides other brokerages and asset houses with a safe and secure solution to access the cryptocurrency and digital payment tokens market.

Wealth-as-a-Service Solution

Kenanga also said that it is looking to partner with digital banks and other digital platforms to embed its digital wealth services to enable them to provide Kenanga’s suite wealth services their customers.

By embedding these wealth solutions digital banks and other digital platforms will be able to go to market at a much faster pace without needing to develop their own products or build their own internal capabilities.

Touch n’ Go eWallet for example has partnered with Principal Asset Management Berhad to offer investment products GO+ and GoInvest to its end users. Digital banks in Hong Kong like ZA Bank and WeLab Bank are also rolling their own wealth services for their next phase of growth.

This demonstrates that there’s a likelihood that there will be a demand for Kenanga’s embedded wealth solutions as digital platforms and digital banks roll out wealth services to remain competitive and fuel their next phase of growth.

However, the players’ ability to offer these embedded solutions on their respective platforms is still contingent on whether or not they are able to secure approval from the Securities Commission Malaysia.

Currently, Malaysia’s regulatory framework requires platform operators to be registered as a Recognised Market Operators (RMO) in order to distribute capital market products.