Walter de Oude, the founder of Singlife, wanted to bring greater returns on spare cash when he formed Chocolate Finance in 2022. Four years later, the asset management firm has now sunk its teeth into the enterprise segment with the launch of Chocolate Business. For Singapore SMEs, in particular, Chocolate is banking on market research indicating that businesses lose around SG$800 million in potential interests by maintaining cash in low-yielding bank accounts.
Whether the SME segment has a sweet tooth for Chocolate remains to be seen. In a conversation with SMEhorizon, the Chocolate Finance Founder and CEO broke down the strategy behind the latest move, including where he thinks the financial sector in Singapore is headed in the next 2-3 years.
What were some of the lessons from founding and growing Singlife that you took with you when you started Chocolate Finance?
I learnt a huge amount from building Singlife, but probably the biggest lesson was that financial services still make a lot of simple things harder than they need to be. When we started Singlife, the insurance industry was still incredibly inefficient, low-tech, and transactional. Most people were complacent and just accepted crappy experiences, but were thrilled when offered a better experience.
Chocolate Finance actually has some of its roots in what I built at Singlife. We created the Singlife Account, which allowed customers to put money in, earn a return, and access it through a debit card. What I learnt from that was that almost everyone wants a better return on cash, and a better cash experience. The Singlife Account was a good start, and the Chocolate Account is way better, with solutions now serving both individuals and SMEs. We’ve simply targeted better returns on spare cash while still being able to access it whenever you need it.
The other lesson was scale. A great product on its own isn’t enough. You have to build something people understand, enjoy using and ultimately, want to tell other people about. We put a huge amount of thought into the Chocolate brand and experience for exactly that reason, because finance doesn’t need to feel complicated or intimidating. Two years in, we’ve grown to more than 150,000 customers and around SG$1.7 billion in assets under management, so the numbers are showing us there is real demand for our solution.
What prompted Chocolate Finance to enter the enterprise segment? What preparations and/or studies were made before you made the move?
The problem we started Chocolate Finance to solve isn’t really a consumer problem or a business problem. It’s a cash problem. People have money sitting around earning very little, and businesses have exactly the same issue. We had already spent two years building a better way for individuals to put their spare cash to work, so applying that thinking to businesses was a pretty natural extension. Businesses often earn very little on cash sitting in their bank accounts and, frankly, the returns can be rubbish. So to us, extending that thinking to business cash just made sense.
We were also hearing directly from business owners who wanted to use Chocolate for their company cash. That was one of the clearest signals for us that there was demand. At the same time, Singapore SMEs are estimated to be missing out on around SG$800 million in potential interest each year by leaving cash sitting in low-yield accounts. To us, that reinforced what we were already hearing from businesses: there was a meaningful amount of cash sitting around earning next to nothing.
But business cash is different from personal savings, and we designed the product with that in mind. Chocolate Business isn’t intended to replace a company’s operating bank account. Businesses still need cash payment services via their OG bank for payroll, suppliers, and daily operations. We’ve built a place for cash to stay in between, where it can be parked to earn a decent return, and “swiped” back to your bank anytime you need it
Can you describe what your infrastructure is like? What is powering Chocolate Finance in the backend?
Chocolate Finance is an asset management company rather than a bank. We run our own infrastructure, managing more than 20,000 transactions per day. As you can imagine, being regulated requires our infrastructure to be of the highest standards.
For Chocolate Business, company cash is managed under a segregated custody through a managed portfolio currently comprising short-duration fixed income and money market funds with no equity exposure. Portfolio allocations are managed around factors including duration, yield to maturity, credit quality and currency, with rebalancing happening behind the scenes to optimise performance where needed.
The customer-facing infrastructure is designed to make that underlying investment process feel simple: businesses can fund their account through FAST or PayNow, monitor balances and returns through the Chocolate Business app, and request withdrawals when needed. For businesses, we’ve also built in company and beneficial-owner verification, two-factor authentication, additional security checks around transactions and real-time account alerts. There is a lot happening behind the scenes, but our job is to make that complexity feel simple to the customer.
How do you balance innovation and compliance in such a tightly regulated industry?
I don’t really see innovation and regulation as opposing forces. In financial services, you have to design within the regulatory framework from day one. The interesting challenge is finding a way to improve the experience for customers while still operating within those guardrails. For me, good innovation is about making things simpler for the customer without compromising the protections that need to be there.
That’s something I’ve been doing for a long time. With Singlife, the opportunity was to use technology to make insurance simpler and more accessible while still operating within an insurance framework. With Chocolate, we’re using an asset-management framework to address what I think is still an underserved part of financial services: cash.
Chocolate Finance is licensed and regulated by the Monetary Authority of Singapore for fund management activities. Of course, any company that is not compliant won’t last long, so it’s part of our infrastructure.
With Chocolate Business, we also try to be very clear about what the product is and isn’t. It is a Cash Managed Account, not a corporate bank account or fixed deposit, and customers’ investments are held separately with licensed third-party custodians.
What are your success metrics for the SME segment? What were the goals you set when you launched Chocolate Business?
It’s still early days, so the first thing we want to see is whether businesses actually find the product useful. Do they start using it, keep using it and become comfortable putting more of their spare cash to work with us over time? For us, those are much more meaningful indicators of success than simply getting a lot of account openings at launch.
We’re deliberately serving businesses of different sizes. There is no minimum deposit, so we’re not trying to optimise around one particular account size. Ultimately, what matters is whether businesses trust us with more of their spare cash over time and keep coming back to the product. If we get that right, the amount of business cash we manage will grow with it.
You just recently launched in Hong Kong and are preparing to launch in Japan. Can you share some insights behind these moves?
Hong Kong was a logical next step for us. It shares many of the characteristics that made Singapore a strong market for Chocolate: sophisticated consumers, strong financial infrastructure, and a well-developed regulatory environment. We officially launched there earlier this year after receiving our Securities and Futures Commission licence. Launching in Hong Kong also gave us the opportunity to take what we had built and learnt in Singapore into another major financial market, while adapting the product for local customers.
More fundamentally, the cash problem isn’t unique to Singapore. Chocolate was built around a very simple observation: people everywhere have spare cash sitting in accounts that could be working harder for them. We think that problem exists across many markets, but that doesn’t mean you simply take the same product roadmap and drop it elsewhere. Each market has its own regulatory environment, customer expectations, and financial landscape. Expanding into new markets gives us the opportunity to take that proposition to a much larger audience.
For Japan, Chocolate Finance is still at an early stage where we are working through the regulatory licensing process. Our focus right now is to ensure we build the right foundations before we talk about launching.
How do you see the financial industry in Singapore shaping up for the next 2-3 years, especially as it relates to SMEs?
Singapore is an incredibly good place to build a financial services business. You have a supportive government and regulator, strong infrastructure and a very sophisticated market. The flip side is that there is also a huge amount of competition, and I actually think that’s healthy. It forces everybody to keep improving in order to keep up with evolving customer expectations.
For SMEs, I think one area that will continue to get more attention is how efficiently businesses use the capital they already have. Businesses naturally spend a lot of time thinking about revenue and costs, but there is also a question around what the cash sitting on their balance sheet is doing in the meantime. I think we’ll see businesses become more deliberate about where they keep that cash, the return they’re getting on it, and how quickly they can access it when they need it. If businesses continue in this direction, it will also create more room for financial solutions outside the traditional banking model, particularly where they can solve a specific need simply and transparently.
I also think SMEs will be quick to adopt AI into their operational models to optimise everything – including how they manage their cash. If AI is helping you compare options and figure out where your money should sit, then simple products that clearly do the job are going to have an advantage.