[Updated] Indonesian sharia fintech startup ALAMI raises over $20m in equity and debt

Editor’s note: This story has been updated to include ALAMI’s announcement.

Indonesia’s sharia-compliant, peer-to-peer (P2P) lending startup ALAMI Technologies has raised over $20 million in equity and debt funding, the company said in an announcement on Monday.

DealStreetAsia had, earlier on Monday, first reported that ALAMI is in talks to finalise over $10 million equity funding led by AC Ventures.

The oversubscribed Series A1 round was co-led by AC Ventures and Golden Gate Ventures, with participation from the global fintech fund Quona Capital, and others. The debt component of the funding was raised from an undisclosed “international impact fund”, the announcement added.

“We believe that the existing players in the sharia financial industry have just utilised a fraction of its potential, as there are more to explore with technologies; the social finance space, for example,” said Dima Djani, ALAMIs founder & CEO, in the announcement.

ALAMI’s latest fundraising follows another round in December. An ACRA filing that month suggested that the startup raised as much as $3.1 million from the early-stage, technology-focused AC Ventures, and others.

While AC Ventures routed the December investment through its fund ACV Capital III, other new investors who participated in the round include FEBE Ventures, Green Tree Asia, and Accion Quona Inclusion Fund. That round was also joined by existing investors namely K9 Industries Pte Ltd (Golden Gate Ventures) and Tryb Pte Ltd.

The company had also closed a $1.5 million seed round, led by Golden Gate Ventures a year ago.

ALAMI, established in 2017, initially operated as an aggregator for Islamic finance, working with sharia banks to facilitate SME invoice financing. However, it expanded into the sharia-compliant P2P lending space in May, after obtaining a peer-to-peer (P2P) licence from the country’s Financial Services Authority (OJK).

AC Ventures was created through the merger of two Indonesian VC firms between Agaeti Venture Capital and Convergence Ventures in April 2020. Agaeti VC is still an existing investor in ALAMI and currently holds 4.1 per cent stake in the company.

ALAMI co-founder Dima Audra Djani currently is the largest shareholder in the company, holding 20.9 per cent stake, according to ACRA. Meanwhile, Golden Gate Ventures holds 20.9% in the company, while Malaeka Pte Ltd and AC Ventures hold 12.4%, 11.1%, respectively.

When contacted, executives at ALAMI and AC Ventures declined to comment on the story.

The proposed funding will help Alami expand its operations and spruce up its technology as it is adopting measures to become more digitally advanced, said sources.

While Indonesia is home to the largest Muslim population in the world, sharia-based fintechs’ growth in Indonesia was stable yet slow in 2020, a year that was laced with uncertainty because of the COVID-19 crisis.

The government of Indonesia recently announced the merger of three state-owned Islamic banks, creating one of the largest Islamic banks globally.

The number of Indonesian Sharia-based fintechs registered in Indonesia stood at 11 last year — seven in peer-to-peer lending, while the rest were in crowdfunding, payments, and investment management, per data collated by DealStreetAsia. In comparison, Malaysia was home to over 26 registered Sharia-based fintechs.

Since its inception to now, ALAMI has reportedly disbursed over Rp300 million worth of sharia-compliant loans.

ALAMI forges partnerships with startups in e-commerce and IOT, hospitals, and logistics companies. In addition, it also has collaborations with Islamic banking financial institutions such as Islamic Commercial Banks (BUS), Sharia Business Units (UUS), and Sharia Rural Banks (BPRS).

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.