A $240 million Hong Kong fintech firm buys an Indonesian traditional bank
A $240 million Hong Kong fintech firm buys an Indonesian traditional bank
Amid a period of transformation in the financial services industry, WeLab, a Hong Kong-based fintech unicorn, announced the acquisition of PT Bank Jasa Jakarta (BJJ), an Indonesian commercial bank, with the goal of establishing Asia's second digital banking institution.
FinTech solutions are allowing banks to operate more efficiently, and WeLab intends to use the new acquisition to launch a digital bank in order to serve the country's large unbanked population, which is estimated to be around 80%.
The acquisition comes after a consortium led by WeLab raised $240 million in funding to acquire the Indonesian bank and expand its digital banking operations. The acquisition comes after a successful fundraising campaign. Furthermore, it follows the successful launch of WeLab Bank in Hong Kong just a few weeks prior.
With the acquisition of WeLab, a Hong Kong-based fintech unicorn has entered Asia's virtual financial services industry for the second time in as many years.
In order to establish a digital banking platform that will provide branchless financial services to approximately 77 percent of the country's 270 million residents, the consortium known as WeLab Sky Group purchased a majority stake in Bank Jasa Jakarta (BJJ) in 2015.
A 24 percent stake in the bank has already been acquired by WeLab Sky, and the remaining shares will be transferred once regulatory approval has been received.
For more than four decades, Bank Jasa Jakarta has had its headquarters in Jakarta, Indonesia. Individual customers as well as small and medium-sized businesses can be served at its 11 commercial bank branches located throughout Indonesia's capital.
Following a meeting with BJJ's CEO Simon Loong, the company intends to allow the bank to retain its traditional branch network while also assisting the bank in expanding its digital banking services in the coming year.
WeLab launched its first digital bank in Hong Kong, a global financial center, last year, with support from the Li Ka-TOM Shing group, which is owned by Hong Kong billionaire Li Ka-TOM.
Currently, the company provides a variety of consumer fintech products throughout Asia, including a virtual bank and a loan product in its home country of Singapore.. A variety of other lending services are also available in mainland China and Indonesia, as well as in the United States.
Company officials claim that they provide technological enablement services to traditional financial institutions and that they serve a total of over 150,000 unique digital banking customers.
According to the company, Maucash, its Southeast Asian lending app developed in collaboration with Astra International, now has more than three million active users in Indonesia.
Despite the country's strong digital economy, many tech companies have been vying for the attention of young people who are well-versed in digital technology.
According to reports, the gross merchandise value of online shopping will quadruple by 2025, reaching $124 billion, up from $44 billion last year and $8 billion in 2015.
In addition to the Greater Bay Area and Southeast Asian countries such as Thailand and Vietnam, the WeLab sky group intends to expand in the United States and Canada.
The acquisition, according to the president of the Indonesian Bank, Jasa Jakarta, is a welcome development because the bank will be unable to continue operating in its traditional manner for an extended period of time.
