Indonesian peer-to-peer lending platform UangTeman said it is set to raise a Series B financing round by mid-2018, claiming it would be one of the largest such rounds for a fintech firm in Southeast Asia.
In an interaction with DEALSTREETASIA, UangTeman founder and CEO Aidil Zulkifli said that the financing round, expected to be in double-digit millions (US dollars), will be used to fund user growth in Indonesia, research and development, and potential acquisitions of other startups. He declined to offer further details.
While Aidil refused to disclose the amount to be raised, two sources close to the development told this portal that the startup is planning to raise $15-20 million in its Series B round.
UangTeman’s Series A funding came in August 2017 when it closed a $12-million round in debt and equity led by K2 Venture Capital. Hong Kong-based STI Financial Group, Draper Associates and Indonesia’s Alpha JWC Ventures also joined the round.
Aidil said that the firm’s existing investors are set to participate in the Series B round.
The funding for UangTeman comes at a time when Indonesia’s fintech industry is witnessing rapid progress, despite still being in its infancy. According to the Financial Services Authority (OJK), around 30 P2P firms had extended 2.6 trillion rupiah (US$193.8mil) in loans as of January 2018, compared with just 247 billion rupiah by December 2016.
This untapped potential has lured investors to place bets on fintech firms in the country. Recently, fellow P2P firm Invetsree revealed that it was also expecting to close a Series B round of investment this year, having facilitated Rp 623 billion loans in the country and expanding its services abroad to Vietnam.
Aidil said the fintech sector as a whole has a clearer revenue model and time to scale, which makes it more suited for big money investment as compared to other verticals.
“Banks/financial institutions are already convinced that fintech is the way to go for partnerships and collaboration,” he said.
UangTeman, which provides instant short-term microcredit to Indonesian consumers, was one of Indonesia’s digital P2P lending pioneers when it was introduced in April 2015. Since then, the startup claims to have recorded more than 300 per cent growth, claiming non-performing loans (NPL) of below 2 per cent.