Editor’s note: This story has been updated with details of Bank Jago’s stock exchange filing.
Indonesian ride-hailing and super app Gojek has picked up an additional stake in listed lender Bank Jago through its payments and financial services arm GoPay.
The lender, in a filing to the Indonesia Stock Exchange (IDX) on Friday, said Gojek had bought 1.95 billion shares in Bank Jago at 1,150 rupiah per share. This translates to an investment of 2.242 trillion rupiah ($160 million), and increases Gojek’s shareholding in Bank Jago to 22.16 per cent, from 4.14 per cent earlier.
The partnership will allow Bank Jago to provide digital banking services through the Gojek platform. Gojek’s millions of users will be able to instantly open a bank account with Jago, and manage their finances via the Gojek app.
It will allow both companies to tap the world’s fourth-largest unbanked population, where 52 per cent of adults, or about 95 million people, do not own a bank account. A further 47 million adults are underbanked or do not access the full suite of financial products, such as credit, investments, and insurance.
However, mobile phone penetration in the country is at 70-80 per cent, making Indonesia infrastructurally ready for digital banking.
Gojek co-CEO Andre Soelistyo said the partnership is a key part of the company’s strategy and will underpin the growth and sustainability of its business in the long term. It also opens the doors for Gojek to collaborate with other banking institutions.
“Jago’s tech-based banking solutions will supercharge Gojek’s ecosystem offerings and facilitate access to banking services for the mass market, thereby supporting our common vision to accelerate financial inclusion in Indonesia. Our aim is to leverage more partnerships like this, to ultimately make the Gojek app a reliable resource for everyone’s financial needs,” Soelistyo said in the statement.
“We believe that this strategic collaboration is the first of its kind in Indonesia and Southeast Asia and represents a new way to spur growth in digital economies. As a bank designed with an open API, we will go on to work with multiple digital ecosystems to reach a wider audience and drive our aspiration to enhance the finances of millions of people through digital financial solutions,” Bank Jago president director Kharim Siregar added.
The new investment doesn’t alter control of Jago, with Metamorfosis Ekosistem Indonesia (MEI) and WealthTrack Technology continuing to be the lender’s controlling shareholders. They own 37.65 per cent and 13.35 per cent, respectively, in the listed bank.
Senior banker Jerry Ng is known to control MEI. Meanwhile, WealthTrack Technology is backed by Patrick Walujo, co-founder & managing partner of Northstar. Bank Jago, known as PT Bank Artos Indonesia earlier, was restructured and officially taken over by Jerry Ng and Patrick Walujo in December 2019.
According to DealStreetAsia’s report about Gojek, Jerry Ng was the largest shareholder, owning 30 per cent of PT GoFin Karya — the fintech services unit which is currently owned by GoPay.
The acquisition of Bank Artos by MEI and WealthTrack last year had sparked speculation that the bank was planning to forge a tie-up with Gojek. At the time, the bank had denied the rumours.
In 2020, Bank Artos changed its name to PT Bank Jago Tbk as part of its transformation to become a tech-based bank to enhance the growth of millions through digital financial solutions.