WeLab, a pan-Asian fintech platform, is taking on the Indonesia market with the acquisition of Bank Jasa Jakarta (BJJ), a commercial bank in Indonesia. Through the acquisition, it plans to launch its second digital bank in Asia further to the launch of WeLab Bank in Hong Kong. WeLab plans to launch this second digital bank in Asia in the second half of 2022.
WeLab, headquartered in Hong Kong, has drawn wide-spread interest from existing and new investors who have already contributed US$240 million for this transaction, representing the largest fintech funding in Indonesia in 2021. The funds will be used to acquire the controlling stakes from its existing shareholders and tech investments.
Indonesia represents a huge opportunity to provide accessible and innovative digital banking solutions. The country, which has around 180 million tech-savvy younger consumers, is one of the largest financially underserved markets in Asia. It is estimated that 77% of its population are either unbanked or underbanked. WeLab claims that it aims to bridge these unmet needs and close the financial inclusion gap with the new digital banking services.
WeLab already has over 150,000 digital banking customers since running WeLab Bank in Hong Kong in 2019, offering customers a new intelligent banking experience through a full suite of digital banking services. It has also established presence in Southeast Asia since 2018 through a joint venture with Astra International to operate a licensed online lending app, Maucash, which already has more than three million Indonesian users.
For this transaction, a WeLab-led consortium, Welab Sky, has entered into a share purchase and subscription agreement with all the shareholders of BJJ. According to the agreement, WeLab Sky will acquire the stakes of BJJ to become the sole controlling shareholder. As the initial step, WeLab Sky has already completed the strategic investment for a 24% stake in BJJ. The remaining stake for majority control will be completed upon obtaining the relevant regulatory approvals, including from the Financial Services Authority of Indonesia.
Simon Loong, founder and group CEO of WeLab, said, “We continue the journey that we started in 2018 to build one of the first pan-Asian digital banking platforms, first in Hong Kong and now in Indonesia. WeLab combines its advanced digital banking technology with the BJJ network to further grow the Bank’s business towards a bright digital future.”
He added that BJJ has earned an “excellent reputation” for being a trusted retail bank in the market over the last 40 years. “We look forward to building on this foundation with our fintech expertise, and success of operating a licensed digital bank in Hong Kong, to build a tech-driven digital bank that will be financially inclusive for the people of Indonesia,” he said.
Handrie Wirawan, president Director of BJJ, said, “We’re excited to welcome WeLab as the new shareholder to bring BJJ into the new digital banking era. BJJ has been undergoing digital transformation since 2018, this strategic initiative is aligned with our commitment and vision in offering digital banking services to more customers. With the experience and expertise of WeLab in digital banking and fintech, we are confident that BJJ can further improve our customers’ financial wellbeing with advanced banking technology.”
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