Chocolate Finance heads to HK with $15m raise

Chocolate Finance is about to hit its first year of operations. Now, the Singapore-based fintech startup has raised US$15 million in series A+ funding.

The company, which has had a rocky few months, is also gearing up for its Hong Kong expansion and has secured a Type 1, 4, and 9 license in the market. These authorize the firm to sell securities, advise on securities, and manage assets on behalf of customers.

Walter de Oude, founder of Chocolate Finance, tells Tech in Asia that these licenses would allow the company to bring its services in Singapore to Hong Kong.

Chocolate Finance CEO Walter de Oude (left) and brand ambassador Henry Golding / Photo credit: Chocolate Finance

Chocolate Finance offers cash management services and provides daily returns on its users’ balances. The company, which doesn’t require lock-in periods from its customers, takes deposited funds and places them into a portfolio of short-term, investment-grade fixed-income funds.

In March, the fintech firm stopped accepting transactions made using bill payment platform AXS, which meant changes to one of Chocolate Finance’s rewards programs. Following that, customers withdrew some US$374 million – or 40% of the firm’s assets under management – over the span of two weeks.

Since then, de Oude says Chocolate Finance’s AUM has leveled out at S$900 million (US$705.5 million). In February 2024, the firm said cash assets were nearing S$1 billion.

Arguably, the withdrawal spree stemmed from a lack of communication with customers after the firm discontinued its partnership with AXS.

Indeed, de Oude previously called the firm’s communications around the move “a mess.”

Speaking with Tech in Asia in an episode of the 60/40 Podcast released last May, the founder said that during the time of increased withdrawals, “we focused very much on managing the press, but we didn’t talk as much to the customers as we should have.”

As Chocolate Finance moves forward, and with the new capital in tow, de Oude says the company’s ambition to grow its AUM “is quite high.” 

First “logical” step

Expanding to Hong Kong is a “logical extension of our business model” as the firm’s first market outside Singapore, notes de Oude.

“Chocolate Finance likes to operate in markets where there is a lot of cash and cash needing returns,” he adds. Singapore has the largest gross domestic product per capita in Asia, while Hong Kong ranks fourth, according to data from Trading Economics.