U.S. markets close in 4 hours 21 minutes
  • S&P 500

    +77.86 (+1.89%)
  • Dow 30

    +508.25 (+1.55%)
  • Nasdaq

    +310.58 (+2.49%)
  • Russell 2000

    +48.97 (+2.56%)
  • Crude Oil

    -0.68 (-0.75%)
  • Gold

    +2.10 (+0.12%)
  • Silver

    +0.26 (+1.26%)

    +0.0123 (+1.20%)
  • 10-Yr Bond

    -0.0420 (-1.50%)

    +0.0166 (+1.38%)

    -2.5270 (-1.87%)

    +905.83 (+3.92%)
  • CMC Crypto 200

    +34.24 (+6.45%)
  • FTSE 100

    +27.51 (+0.37%)
  • Nikkei 225

    -180.63 (-0.65%)

FinAccel Spends $200 Million for Indonesia Digital Banking Push

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·2 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

(Bloomberg) -- FinAccel Pte, the parent company of fintech platform Kredivo, has acquired a majority stake in Indonesia’s PT Bank Bisnis Internasional TB, pitting itself against Southeast Asia’s biggest internet companies for a share of a growing digital banking arena.

Most Read from Bloomberg

The Singapore-based company, which spent a total of about $200 million on accumulating the holding, will have a 75% stake in the Jakarta-based lender by the end of this week, Chief Executive Officer Akshay Garg said in an interview.

Since the second quarter of 2021, closely held FinAccel has been snapping up stakes from entities owned and controlled by the Suriadi family, which runs a textiles and real estate centered business based in Indonesia, through subsidiary PT FinAccel Teknologi, he said. Shares of PT Bank Bisnis have more than tripled in the past year, giving it a market value of about $1.2 billion.

The move accelerates FinAccel’s ambitions to expand beyond the online lending business into Indonesia’s highly competitive digital banking space. Its peer, Ant Group Co.-backed Akulaku Inc., is set to raise its stake in Jakarta-based Bank Neo Commerce. Singapore’s Sea Ltd. last year acquired Bank BKE to gain a foothold in the fintech arena.

Ride-hailing and food-delivery platform Grab Holdings Ltd. teamed up with Singapore Telecommunications Ltd. to buy a minority stake in Bank Fama, while rival Gojek in 2021 spent about $160 million to raise its holding in PT Bank Jago.

“Some of our competitors might benefit from large ecosystems where they can cross-sell digital banking products to other customers on their platforms,” Garg said. But FinAccel -- mainly centered around its buy now, pay later product Kredivo -- can find a leg up by offering competitive consumer credit rates and a smooth customer experiences, he added.

Many small banks in Indonesia, some part-owned by local tycoons, have been looking to tech players for fresh funds after the country’s regulator raised capital requirements for banks in 2020.

The region’s internet giants are using this opportunity to aggressively expand their suite of financial service products in Indonesia, a country of about 273 million people where many have limited access to bank accounts and credit cards.

FinAccel’s purchase comes shortly after its planned merger with a blank-check company collapsed. The combination with Chicago-based Victory Park Capital Advisors LLC was canceled after a tepid climate rocked confidence in many deals.

Read more: SPAC Mergers Are Falling Apart at Rapid Pace in Sign of Fatigue

Aborted SPAC mergers reached a record high of 15 in the first quarter and more than 30 for the past year, according to data compiled by Chicago-based SPAC Research. In part, that’s because the deals were negotiated when prospects for SPACs and the macro outlook were brighter.

“Our ability to raise money from that fundraiser came down significantly,” said Garg.

Most Read from Bloomberg Businessweek

©2022 Bloomberg L.P.