JAKARTA - WeLab, a Hong Kong-based fintech company, plans to launch a digital bank in Indonesia next year.
Previously, WeLab through WeLab Sky Limited (WeLab Sky) together with Astra Financial (PT Sedaya Multi Investama) acquired Bank Jasa Jakarta with a total transaction value of USD 500 million or around IDR 6 trillion. The plan is that the funds will be used to strengthen the core capital of Bank Jasa Jakarta in order to meet the provisions of the Financial Services Authority, which is set at IDR 3 trillion. As of June 2022, the bank's core capital was recorded at IDR 2.1 trillion and the increase in capital will be reflected at the end of the year.
After this transaction, WeLab and Astra Financial will each own 49.56 percent of Bank Jasa Jakarta's shares. Previously, the two parties had partnered to form a fintech lending JV named PT Astra WeLab Digital Arta known as MauCash in 2018.
WeLab CEO Simon Loong said that Indonesia has potential for the digital banking market given its large population. This digital bank will target the tech-savvy young generation.
Simon explained some of the unique advantages that WeLab has in Indonesia's competitive digital banking market. First, WeLab already has a product and know-how that is already built and running for five years, while new players have to start from scratch. Second, WeLab is run by people who have been in the banking industry for a long time, such as Simon who has worked for 25 years. Third, WeLab collaborates with Astra, which has a very large ecosystem and partnership for several years.
“Lastly, we learned that in digital banking, it is good to have more digital banks, because digital banks are still new. When you are the only and first player, you spend a lot of money to entertain customers. However, when you have several people doing it at the same time, reporters write about it, bloggers also write about it, everyone is actually educating the market and helping the consumers” explained Simon.
WeLab Bank was first launched in Hong Kong in 2020 with several different features from other banks. Starting from debit cards without numbers in collaboration with Mastercard, to GoWealth Digital Wealth Advisory in collaboration with Allianz.
To date, WeLab has disbursed loans of up to USD 12 billion and has more than 55 million users. This bank group has also managed to raise more than USD 900 million in funding. (LM)