MANILA, Philippines — Small businesses remain the backbone of Southeast Asia’s economy, generating two out of every three jobs across the region. Yet despite their vital role, micro, small and medium enterprises (MSMEs) continue to face systemic barriers that hinder their growth—chief among them, limited access to capital.

At the recently concluded Mastercard ASEAN Inclusive Growth Summit (AIGS), public and private sector leaders gathered to discuss how to turn these barriers into breakthroughs.

Fuse Financing Inc., the lending arm of GCash, a leading finance superapp and the largest cashless ecosystem in the Philippines, joined the dialogue as a key private sector partner accelerating access to capital, data and product innovation for MSME growth across the region.

The panel session, titled “Small business: From barriers to breakthrough,” featured Fuse Financing president and CEO Tony Isidro, ASEAN Business Advisory Council (ASEAN-BAC) Philippines chairman and Go Negosyo founder Joey Concepcion III and Beacon Fund co-founder and CEO Shuyin Tang, moderated by Mastercard Center for Inclusive Growth senior vice president for social impact Subhashini Chandran.

Isidro highlighted how digital tools are transforming credit access. In the Philippines, many MSMEs do not have access to formal lending because of lack of requirements, such as credit history.

“In the case of Fuse, we created a proprietary trust score, which we call GScore, which is in turn based on the MSME's footprint in the GCash ecosystem,” Isidro said. “Through GScore, we're able to remove the friction that's otherwise associated with formal lending—including collateral [and] additional documents.”

Isidro noted that this data-driven approach allows them to identify eligible MSMEs who otherwise would have to resort to informal channels with abusive rates and harassment, enabling them to borrow to expand their business "with dignity.”

He stressed that achieving sustained progress requires collaboration with like-minded partners.

“It's also important to note, and certainly for us, this is our belief, that no one organization can do that. It's this collaboration that will help move the needle for MSMEs in the Philippines,” the GCash official said. As of the third quarter of 2025, Fuse has disbursed a total of P323 billion ($5.5 billion) to 10.2 million unique borrowers. One in three borrowers are small business owners, three in five are women, and four in five come from the mass market. Each loan helps users build a digital credit record, empowering them to access better rates over time while encouraging responsible borrowing through clear repayment terms and flexible payment options.

Chandran, meanwhile, agreed that financing should be more accessible to MSMEs. “[One] of the things we noted is that the health of Southeast Asia's economy really depends on how we finance the missing middle of small and growing businesses,” the Mastercard official explained.

Representing the private sector, Concepcion emphasized that sustained progress requires long-term collaboration between business and government. “Big business, big countries who are able to have enough, should share with the smaller countries who have less,” he said. “[The] private sector cannot do it alone. You have to partner with your government. But it is not an overnight solution—it will take many years.”

From the investor’s perspective, Tang called for more targeted approaches to SME financing. “We really need to challenge ourselves to think a little differently about how [we can] localize our fund structures and models to meet what the market really needs,” she said.

The panel concluded that enabling MSMEs to thrive demands a comprehensive, multi-year approach anchored in strong public-private partnerships. Through collaboration and digital innovation, Asean economies can help small businesses scale proven solutions to ensure the vitality and stability of the region’s economic ecosystem.

The Malaysian state of Johor is debuting a sprawling new innovation sandbox, bolstering its plans to build a “regional champion” alongside the border with Singapore. 

The 7,300-acre development—named Ibrahim Technopolis (IBTEC)—is located within the Johor-Singapore Special Economic Zone, a new strategic partnership between Singapore and Malaysia meant to create over 20,000 jobs for people on both sides of the causeway. Designed to be Asia’s largest innovation sandbox, it will concentrate high-value industries like medtech, logistics, data centers and agritech. 

IBTEC, formally launched on Dec. 2, will make “production smarter, supply chains more resilient and operations more efficient,” said developer JLand Group, the real estate arm of Johor Corporation, in a press statement. 

The innovation park is part of a broader plan to tap Johor’s proximity to Singapore to attract investments from high-tech industry and other advanced manufacturing. 

Malaysia and Singapore formally launched the special economic zone earlier this year. Part of the agreement involves measures to make it easier to travel back and forth between Singapore and Johor, already one of the busiest land border crossings in the world. 

Officials have high hopes for the SEZ. The goal is to make it a “regional champion,” and not just “an industrial park with a nicer brochure,” YB Lee Ting Han, chair of the Johor State Investment, Trade, Consumer Affairs and Human Resources Committee, said at the Fortune Innovation Forum on Nov. 17. 

Johor, and Malaysia in general, offers lower costs and greater access to resources like land for foreign companies, even as these firms continue to base higher-value activities in more expensive Singapore. 

“While Johor offers land and scale, Singapore offers capital and speed. So this is the opportunity that I feel we need to capitalize [on], where we can complement each other,” Datuk Syed Mohamed Syed Ibrahim, Johor Corporation’s president and CEO, told the audience at the Fortune Innovation Forum on Nov. 17.

Tapping the data center boom

Demand for data centers has skyrocketed in response to the AI boom. Southeast Asian countries are hoping to attract new data center investments from operators looking for cheap power and proximity to booming markets in the region. 

New economic complexes like IBTEC have sprouted in response, designed to house and manage critical IT infrastructure providing computational power to train AI models on vast datasets. 

Singapore’s small land mass and costly industrial power tariffs have pushed investors to look north; Johor’s power tariffs stand at 13.5 cents per kilowatt-hour, almost half of the 23.9 cents charged by its neighboring city-state.

StepEast, a data center hub within IBTEC, has already secured more than 30 billion Malaysian ringgit ($7.28 billion) in investments from 11 international operators, reported the Business Times, a Singaporean newspaper. This includes big tech conglomerates like Microsoft.

“We are building the infrastructure, systems and execution capacity so that investors can come in faster and grow with more certainty,” Datuk Sr. Akmal Ahmad, the group managing director of JLG and JCorp’s director of real estate and infrastructure division, said in the Dec. 2 statement. 

Data center operators are paying attention. “Johor is adding data center capacity at a speed and scale I’ve not seen ever anywhere else,” Rangu Salgame, CEO of Singapore-based data center operator Princeton Digital Group, told Fortune in April.

Benefits for local businesses and SMEs

Despite being a project of massive scale, IBTEC will focus on the needs of SMEs and local Malaysian businesses, JLG added. The development will offer them shared facilities and plug-in spaces, where they can collaborate with larger industry players.

“We will measure IBTEC’s success not only by the investments it attracts, but by how it helps Malaysians and Johoreans move up the value chain—as workers, entrepreneurs and communities,” said Akmal Ahmad. “That is how we intend to prove the real impact of this ecosystem.”

“We really need to be able to connect our SMEs to global supply chains and to create brands owned within the zone,” Lee, from the Johor state government, said at the Fortune Innovation Forum.

IBTEC will also enable Malaysian start-ups to better partake in regional supply chains, open new doors for local entrepreneurs, and further the Southeast Asian nation’s goal of achieving sustainable, innovation-led development.

“IBTEC is an investment for the next generation, and a signal that Johor is ready to compete on a different frontier,” Syed Ibrahim added in JLG’s press statement. 

Malaysia as a whole has attracted 285 billion Malaysian ringgit ($69 billion) in approved investment (or proposed investment projects that have received all the necessary licenses) in the first three quarters of the year, up 13% year-on-year, according to a Dec. 3 report from Nomura. The state of Johor alone is responsible for almost a third of that total, with investments into the state totaling 91 billion ringgit ($22 billion) in the first nine months of 2025.

Nomura now expects Malaysia’s economy to grow by 5.2% next year, up from an earlier forecast for 4.0%. “We expect strong investment-led growth to persist into 2026, sustained by the implementation of more reforms and infrastructure projects, and progress in the Johor-Singapore Special Economic Zone (JS-SEZ),” Nomura’s analysts wrote in their Dec. 3 report. 

Source: Fortune, 9/12/2025 (https://fortune.com/2025/12/09/johor-launches-ibtec-singapore-sez-data-centers/)

PDS Abattoir has signed a Memorandum of Understanding (MoU) with Singapore’s Aliyah Rizq Holdings to pilot the sole commercial cattle breeding programme in Brunei, as part of a wider livestock breeding initiative that also includes sheep and buffalo.

The cattle breeding pilot will begin with a trial involving the import of ten parent stock as a proof of concept. This will evaluate breeding success rates, operational challenges, and the overall feasibility for commercial expansion, which would require substantial investment.

Implementing a local breeding programme marks another significant expansion PDS Abbatoir – which became a wholly government-owned company in 2021 – and has traditionally been focused on importing livestock for slaughter and meat processing.

During the COVID-19 pandemic, PDS expanded its value chain to include feedlotting – the process of importing young livestock to be raised and fattened to commercial size before slaughter. The new breeding programme takes this a step further, aiming to establish a complete livestock ecosystem within Brunei.

PDS General Manager Sabirin Othman explained on the sidelines of the MoU signing on September 1 that while Brunei has small-scale breeding of sheep and buffalo, there is currently no commercial-scale breeding of cattle.

He said partnering with Singapore’s Aliyah Rizq Holdings brings in a partner with proven breeding expertise and international experience. Established ten years ago, the company has since scaled to 60,000 livestock across seven countries through its cluster-based farming model.

Thailand’s Enserv Holding will launch Brunei’s first sorghum cultivation and processing initiative by year’s end, leveraging the crop’s versatility for applications in food, health and renewable energy.

Through its local arm Enserv BN, the company signed a tenancy agreement with the Department of Agriculture and Agrifood (DOAA) on September 4. It will establish a sorghum nursery at the Bio Innovation Corridor in Rimba and cultivate the crop at the nearby Agricultural Development Area (KKP) in Tungku, spanning a total of three hectares and supported by processing facilities for flour and biomass.

The initial sandbox phase will test the commercial feasibility of Enserv’s EMF3 platform (Food, Fuel, Fundamentals), which positions sorghum – a grain originating from Africa – as a “super crop” with potential for a value chain spanning food to renewable fuels. If successful, the project will advance to commercial-scale production.

Enserv Chairman Tanachat Pochana explained that the sorghum grain, which is gluten-free and rich in micronutrients, will be processed into resistant starch flour to produce EMF Rice, a low-calorie carbohydrate alternative suitable for diabetics and those managing their weight.

The stalks can be converted into solid biofuels such as biocrude oil and biocoal, while the sweet sap, traditionally used for molasses, can be fermented into bioethanol with further applications in biobased energy storage. By-products from these processes, such as bran and distillers’ dried grains, can also be used for animal feed.