DEALSTREETASIA broke this development about a potential partnership between the two players in a story published on March 31, 2017.
The new venture will initially take the form of a payments platform within BlackBerry’s messaging service, which has about 63 million users in Indonesia. “Ant Financial has proven know-how in delivering payment and other financial solutions to a large and growing mobile audience in China … and we are looking forward to replicating and creating this success in Indonesia,” Emtek CEO Alvin Sariaatmadja said in the statement.
Ant Financial has already struck deals with Thai payment company Ascend Money, South Korea’s Kakao Pay Corp and Philippines-based fintech business Mynt. It also has plans to close further deals in Asia this year. The Indonesian venture also comes as Ant faces off against U.S. company Euronet Worldwide to acquire Dallas-based Moneygram International, a remittance business that could play a significant role in linking Ant‘s other payment assets in Asia.
Clearly Ant Finanical’s JV with Emtek for the latter’s digital platforms to crack Indonesia’s biggest pain point – digital payments – could be a step to its first big entry in Indonesia.
Currently Alibaba already has a presence in Indonesia following its acquisition of Southeast Asia’s largest e-commerce player – Lazada – in a deal that was valued at $1.5 billion. This development comes even as Lazada has significant plans for Indonesia.
A JV with Emtek will enable Ant Financial to leverage the BBM platform, which continues to be the most popular messaging app in Indonesia, across both iPhone and Android users. Several surveys shown that BB commands up to a third in market share when it comes to messaging platforms in Indonesia, as well has having the highest reach among Android smartphone apps in that country, at 90%
Emtek, through its digital arm, PR Kretaif Media Karya (KMK), had bagged the licence to develop new BlackberryMessenger (BBM) applications and services for Android, IOS and Windows Phones in June 2016, and it also owns and operates several other portals such as Liputan6.com, Vidio.com, Bintang.com, Bola.com and Karir.com and propertypotal.com.
Even for Lazada, as much as it will be about logistics, distribution and warehouses, the key to success in Indonesia and even e-commerce in Indonesia will be a successful fintech (payment) strategy.
To put this argument in context, when this region’s largest ride-hailing platform Grab recently committed to investing $700 million in Indonesia, the capital was not aimed at escalating a price war with Go-Jek, or more incentives to its drivers, but largely towards enhancing and developing its payment platform. Earlier this month, Grab confirmed that it had reached a deal to acquire Indonesian payment startup Kudo, a step that is seen as being critical to augment its mobile payments platform, as it battles local competitor Go-Jek, in Southeast Asia’s largest economy.
Emtek also holds a significant stake in Bukalapak, Indonesia’s third largest e-commerce player. BlackBerry Messenger (BBM) and Bukalapak already had a partnership called BBM Shopping that allowed users to browse products offered by Bukalapak, and make payments to complete transactions without ever leaving the app.
What has caught Alibaba’s attention is that Emtek is modelling the strategy for BBM in Indonesia in line with what China’s WeChat has successfully achieved. WeChat has now become a one-stop shop for watching video, getting celebrity updates and shopping online, and more. Currently Chinese users use WeChat to navigate their daily lives, integrating social media, payments, web browsing and messaging into a single application.
Bringing Alibaba to the table could speed up Emtek’s plan of making BBM into a platform that is similar to that of Wechat. Besides, this will also help Ant Financial other biggest investment in this region – Lazada – crack the payments frontier.
Big picture, Ant Financial will also have its hands on two of three largest e-commerce players in Indonesia, like Bukalapak as well.
In a recent interview with DEALSTREETASIA, Bukalapak COO did confirm that ‘ they are open to strategic partnerships, if it helped the company grow. On being asked if the company is in talks with Alibaba, Bukalapak in an email reply said, that it was currently ‘focusing on extensification of its business.’
Alibaba has continually shown interest in South East Asia and the Indonesian market as well over the last few years. In 2015, Alibaba signed an agreement with Indonesia’s largest online payment provider, Doku, to fast track and simplify payments made for Indonesian customers.
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