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LINE bolsters digital banking services with 20% acquisition of KEB Hana Indonesia

LINE Financial Asia, a subsidiary of LINE Corporation, will acquire 20% of Bank KEB Hana Indonesia through a share subscription agreement. This is designed to expand LINE’s digital banking services in Indonesia which is expected to launch in 2019.

This agreement will see LINE Financial Asia become the second-largest shareholder in the bank, adding digital banking to LINE’s broad range of services and content enjoyed by users in Indonesia. It also improves the company’s positioning in Indonesia and globally, as it looks to grow as a fintech and digital banking provider.

As for the bank, the deal will add LINE’s user base to its potential pool of consumers, and strengthen its digital marketing capabilities through LINE’s branding, technology, content and know how. The acquisition will also expand the bank’s volume of low-interest deposits and improve its product portfolio by growing retail banking services.

For LINE Financial Asia, the deal improves the company’s positioning in Indonesia and globally as it looks to grow as a fintech and digital banking provider. Together, both parties are also looking to create deposit/microcredit products, and remittance and payment services for Indonesia.

They also aim to implement and improve credit rating models through projects with local and international credit rating agencies, creating an identity verification process optimised for local regulations, and other measures. LINE is one of the popular messaging platforms in Indonesia, and PT Bank KEB Hana is a foreign bank that has successfully localised for the Indonesia market.

“Through this partnership with Bank KEB Hana, we will launch easy-to-use and innovative banking services in Indonesia. This agreement is an important step toward becoming a leader in mobile banking and expanding our fintech services,” said LINE Financial Asia CEO In Joon Hwang.

“I believe LINE’s advanced digital technology and KEB Hana Bank’s retail banking experience will prove to be the future of the banking industry, demonstrating a new financial model that begins in Indonesia,” PT Bank KEB Hana president director Lee Hwa-Soo said.

(Photo courtesy: 123RF)

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