I had same with 3 of 5 babies they were about maybe less than one week their mom was too stressed and didn't clean them so they had their genitals blocked with poos and it looked pretty bad when I removed them. I just cleaned with warm water (you did already), I used herbal teas to rinse them with a cotton wool pad a few times a day, hold for a few minutes and then dried with paper towel. I don't use antibiotics unless there's no other way, I don't remember now probably sage tea or chamomile, even if you have black or green tea (I don't use teabags only loose teas) they are all antibacterial, especially sage is very strong and wounds healing fast.
Babies grew up and now are 9 months old, took a few days to heal but first looked horribly I was really scared.