Digital wallet service owned by state-owned firms, LinkAja, has made an acquisition of P2P lending operator, PT iGrow Resources Indonesia with undisclosed amount - Photo by the Company

JAKARTA (TheInsiderStories) – Digital wallet service owned by state-owned firms, LinkAja, has made an acquisition of P2P lending operator, PT iGrow Resources Indonesia with undisclosed amount, both announced yesterday. This acquisition its expecting will help iGrow in realizing their vision and mission to strengthen Indonesia’ agricultural sovereignty at the world level by providing access to capital for Indonesian farmers.

“Hopefully this will further strengthen iGrow as a pioneer and also the largest peer to peer lending platform in agriculture,” said director of of iGrow, Jim Oklahoma, said in an official statement.

iGrow businesses has been run for seven years since 2014, and has channeled funding of Rp318 billion (US$21.93 million) to more than 10,000 farmers in various regions in Indonesia. President director of LinkAja, Haryati Lawidjaja, believes that iGrow is the right partner because it has a similar vision and mission to improve welfare and support the lower middle segment, especially the productive groups.

Now, said Lawidjaja, the financial technology (FinTech) firm has 68 million registered users through the digital ecosystem and has more than one million local merchants, 370,000 merchants, 230 modes of transportation, more than 680 traditional markets, 44,000 digital donation partners, and more than 6,000 online marketplaces.

Recently, LinkAja had received series B funding more than $100 million from decacorn, GoJek and other investors. Earlier, ride-hailing startup giant, Grab, also joined in the Series B funding round. With the new capital, the provider now has a total commitment more than US$100 million.

Lawidjaja explained, after the transaction, the two companies aimed to strengthen the adoption of digital financial services and accelerate financial inclusion in Indonesia. As part of the partnership, the digital company will expand the payment method options for certain services on the GoJek application in Indonesia.

By combining the strengths of these two national companies, she claimed, will create a cashless payment experience for the various needs of users in complementary market segments. Currently, LinkAja platform is mostly focused on payments for retail purchases, public services and daily necessities with 80 percent of the users coming from Tier 2 and Tier 3 cities in Indonesia.

While, GoPay served the retail and business sector in Indonesia, especially for micro, small and medium enterprises. In this fundraising Credit Suisse acted as exclusive placement agents.

LinkAja is a digital wallet under PT Telekomunikasi Selular (Telkomsel) owned 25 percent, PT Bank Mandiri Tbk (IDX: BMRI) hold 19.71 percent, PT Bank Rakyat Indonesia Tbk (IDX: BBRI ) of 19.71 percent, PT Bank Negara Indonesia Tbk (IDX: BBNI) of 19.71 percent, PT Bank Tabungan Negara Tbk (IDX: BBTN) of 7.12 percent, PT Pertamina of 7.12 percent, PT Asuransi Jiwasraya one percent, and PT Danareksa 0.63 percent.

In 2019, the shareholders has injected to the operator of the digital money, PT Fintek Karya Nusantara (Finarya), with a total value of Rp1.65 trillion ($113.79 million). Then, in the second phase worth of Rp186 billion.

Micro, small, and medium enterprises (MSMEs) are one of the backbones of Indonesia’ economic. According to Statistics Indonesia data, the number of MSME players has reached 64 million with a growth of 2.02 percent annually. While, based on Financial Service Authority data total disbursement of new P2P lending financing increased by 26.5 percent compared to 2019.

US$1: 14,500

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