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Gaming hardware manufacturing company Razer has come a long way since CEO and cofounder Min-Liang Tan had the idea to design a computer mouse specific for gamers back in 2005. According to the firm’s latest financial results, 2020 was a record year, with Razer for the first time achieving over US$1 billion in revenue, in the process also registering its first ever annual profit.
Razer’s success naturally lies in its hardware business, where it enjoys a hugely loyal fanbase for its controllers, headsets, keyboard, and laptops. But there is another business segment that is growing fast and which is pointing to a new — and potentially highly profitable – revenue stream for the gaming industry: fintech
In 2017, Razer stepped for the first time into the fintech sector with the launch of in-game payment service Razer Gold, which now has 26 million registered users. This was followed in 2018 by Razer Fintech, a digital payment network targeting both B2B and B2C end users across Southeast Asia.
Revenue from the financial services arm grew over 66% in 2020 to US$128.4 million. Speaking at an earnings briefing in March, CEO Min said the financial services growth was “truly phenomenal”, adding that it had been driven by surges in Razer Gold usage in the early days of the COVID-19 pandemic, as well as the demand for Razer Fintech B2B services due to the accelerated digitization of many businesses in the region.
Digital payments in Southeast Asia
When it comes to fintech, Southeast Asia is one of the fastest-growing markets in the world, outpacing the US, the UK, and even China. Razer is one of a number of companies with no previous financial sector experience that are now making significant steps into the sector. From ride hailing apps to e-commerce platforms and even airlines, more companies in the region are now also offering fintech services such as digital payments, loans, and even virtual banking.
“The usage of fintech, especially e-wallets, is a growing trend in Asia, especially in East and Southeast Asia,” Darang Candra, director of Southeast Asia at Niko Partners said. “None of Razer’s fellow unicorns in the region, such as Sea Group, Grab, and Gojek, started as fintech companies, but they later created their own fintech services — SeaMoney, GrabPay, and GoPay, respectively. This helped in pushing brand loyalty to their respective services. Razer seems to be in line with this trend.”
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Source:: Business Insider