Indonesian state lender BRI to invest $20m in LinkAja operator

Photo by Bank Rakyat Indonesia

Indonesia’s state-controlled lender BRI is planning to invest Rp 300 billion ($20 million) in Fintek Karya Nusantara (Finarya), that operates mobile payment platform LinkAja, a BRI executive said on Wednesday.

LinkAja is an integrated e-wallet service, which manages the existing payment app of the country’s largest telco firm Telkomsel, and three other state-controlled lenders, Bank Mandiri, BNI, and BRI.

BRI will inject the fund in Finarya through its own investment arm BRI Ventures.

“We will hold 19 per cent stake in Finarya,” BRI president director Suprajarto told reporters in the general shareholders meeting on Wednesday.

Suprajarto said that State-owned Enterprises Minister Rini Soemarno expects other state-owned companies to join and own stakes in Finarya, especially transportation-focused firms, such as Kereta Api Indonesia or KAI, Damri, and Jasamarga.

DEALSTREETASIA recently reported that BRI set up a VC firm through the acquisition of venture capital firm Bahana Artha Ventura, wherein the lender was being assisted by experts from MDI Ventures, a CVC affiliated with state-owned firm Telkom Indonesia. BRI obtained the business license from the country’s Financial Services Authority (OJK) last month.

BRI Ventures is the third VC firm to be set up and operated by state-owned companies in Indonesia. The other ones in the segment are Telkom Indonesia (MDI Ventures) and Bank Mandiri-owned Mandiri Capital Indonesia.

Currently, another state-controlled lender BNI is also planning to enter the VC space by establishing a venture capital firm, that is slated to launch this June.

“Venture capital will help our future investments in many fintech startups and also fulfill our corporate actions plan,” BNI deputy president director Herry Sidarta told DEALSTREETASIA.

LinkAja currently has around 40 million users. It competes with services such as Go-Pay, operated by ride-hailing platform GOJEK, and OVO, a Lippo-backed e-wallet service.

Now the ubiquitous e-payment systems, GO-PAY and OVO have been installed in millions of mobile devices. It can be used to pay for almost everything, including food delivery, insurances, ride services, e-commerce transactions, and even paying electricity bills.

The government, on its part, is pushing corporates to team up and establish its own electric payment platform to foray into the segment and strengthen its presence.