SINGAPORE, June 29, 2023 /PRNewswire/ -- The Singapore-based travel-tech company utu today announced its acquisition of CardsPal — a Singapore-based platform — along with closing a deal of US$33 million in combined transaction value. The deal, comprising of the acquisition and a funding round, consists of both a portion of new funding, with SC Ventures participating, and the roll-over of earlier funding from Singapore-based investors, who supported the company through the pandemic. With CardsPal's plentiful hyper-localised rewards promotions and existing infrastructure, the acquisition in particular will allow utu to accelerate growth by leveraging the platform's unique mobile-first technology and superb talent. Pivotal to utu's decision to acquire CardsPal is SC Ventures' support incubating the startup to become a full-fledged tech platform that utu can leverage to expand its reach in major tax-free shopping markets in Southeast Asia, East Asia, and beyond.
Travel has rebounded after the pandemic, with the World Travel and Tourism Council (WTTC) forecasting the industry to reach US$9.5 trillion in 2023, or 95% of 2019's pre-pandemic peak. Despite this remarkable turnaround, McKinsey reports that only about 1% of venture funding in the past 15 years has gone to travel, mostly in short-term rental hospitality. The tax-free shopping sector is especially subject to this innovation lag, and the high cost of refund processing tends to dissipate the benefits of refunds to travellers.
Re-engineering tax-free shopping to bring more value to partners and travellers
utu, co-founded by travel retail and VAT refund veteran Asad Jumabhoy, is addressing these hurdles. Rather than just competing with existing players, utu collaborates with refund and travel industry partners, enhancing refund value through innovative B2B and B2C solutions. With a reengineered approach that links payments, rewards, and shopping, utu introduces new value for the entire tax-free shopping value chain.
Asad Jumabhoy, co-founder and CEO of utu, said: "The cross-border travel market is ripe for a technology-driven transformation, with tax-free shopping presenting vast untapped potential. By enhancing the value of VAT and GST refunds for travellers, we've reimagined the cross-border retail experience and devised a technology-based business model unlocking previously inaccessible value."
utu offers users two primary value-centric benefits when they opt to receive tax refunds via their utu Tax Free Card. Travellers can gain up to 40% more value by choosing frequent flyer miles or hotel points over cash refunds. Secondly, utu can issue an immediate store voucher equivalent to up to 120% of the tax.
For its partners — such as retailers, airlines, and other travel industry players — utu can potentially boost their revenue from tourist shopping by up to 40% and is already delivering this value through key relationships with 10 leading global airlines, including Singapore Airlines, Emirates, EVA Air, and Thai Airways, as well as Europe's largest hospitality brand, Accor.
Flourishing capacity and reach
The CardsPal acquisition equips utu with a digital marketplace, a unique promotions engine, a self-service merchant registration portal, and more. Its technology and mobile-first technology talent will expedite utu's rollout in major tax-free shopping markets like Thailand, Singapore and Australia, offering VAT and GST refunds.
Gautam Jain, Member, at SC Ventures said: "CardsPal is a great example of why we at SC Ventures believe in the power of innovation and support our employees to have transformational impact. Through SC Ventures' Intrapreneurship Program, CardsPal grew to become a substantial business with award winning UX. We look forward to utu's continued success scaling its products across the globe using CardsPal's technology."
About utu
utu (pronounced "you-too") is transforming tax-free shopping worldwide by empowering travellers with the freedom to obtain a higher VAT refund, by going beyond digitizing refunds to re-engineer the tax-free shopping value chain to the benefit of travellers. Founded in 2015 in Singapore, utu can now be used in over 50 countries.
For more information, visit www.utu.global or download the utu app at https://utu.global/get-the-app/.
About SC Ventures
SC Ventures is a business unit that provides a platform and catalyst for Standard Chartered to promote innovation, invest in disruptive financial technology and explore alternative business models.
For more information, please visit www.scventures.io and follow SC Ventures on LinkedIn.
