Indonesian fintech startups Flip, OY! nab funding to expand ops

Jakarta, Indonesia. Photo by Afif Kusuma on Unsplash

A host of regional venture capital firms have quietly made early-stage investments into two rival interbank money transfer platforms in Indonesia, said sources privy to the development.

While Sequoia Capital is understood to have invested around $3 million in fintech startup Flip in March, a group of investors including Agaeti VC, Wavemaker Partners, Pavilion Capital, MDI Ventures and Central Capital Ventura backed a seed round for newcomer OY! late last year.

When contacted, Sequoia declined to comment on the investment, while separate emails sent to Flip and OY! did not elicit any response.

Flip, headquartered in Depok, was established in 2015. It enables users to transfer funds between different banks for free in a market where people typically have to pay a processing fee of about 6,500 rupiah ($0.46) for interbank transfers.

The startup, considered a pioneer in the free-of-charge digital bank transfer game, currently works with 14 banks. It creates accounts in multiple banks, thereby connecting itself to the banks’ API to facilitate fund transfers for a larger number of people for free. It reportedly has facilitated transfers worth close to 7 billion rupiah ($470,200) to date.

Its rival OY!, meanwhile, launched its bank transfer service late last year even as it was set up in 2017.

Co-founded by former Gojek vice-president and aCommerce manager Jesayas Fernandinus, OY! started its operations by enabling users to perform money transfer for free. However, of late, it has started monetizing its services, by charging 2,000 rupiah for interbank transfers of more than 5 million rupiah – still much lower than the market rate.

OY! caters to enterprises, offering products such as disbursement APIs, bulk disbursements, payment checkout and payment collection service via SMS.

The funding into the startups signals growing investor interest in the overall fintech sector. While Flip and OY! do not currently have direct competitors in the market, there are a host of industry biggies that have expanded their services to foray into the free bank transfer space to cash in on early boom days.

Some of the country’s lenders that have rolled out bank transfer services over the past year are BTPN, and mobile payment giants GoPay, OVO and DANA. However, all of them come with limitations and have included a cap on the number of free transfers that customers can avail per month.

Flip made headlines last year when it raised an undisclosed amount from Singapore’s Insignia Ventures Partners to facilitate its expansion plans.

In an interaction with us, Insignia confirmed that it was Flip’s first institutional round, but declined to comment on Sequoia’s recent investment in the startup.

“Flip was an early player in Indonesia’s fintech space, and while the digital banking industry in the country has changed rapidly in the last five years with more players, Flip has developed a deep understanding of its users (and has essentially grown with them) and the market,” said Insignia managing partner Yinglan Tan.

Following the investment by Insignia, Flip launched two paid services: BigFlip, which caters to the bank transfer needs of enterprises, and FlipInstant which caters more to customers who are willing to pay more for speed.

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.