Fintek Karya Nusantara (popularly known as Finarya), that operates integrated e-wallet service LinkAja, is targeting to close the second tranche of Series A funding round by the end of this year, a top executive said on Wednesday. The company is expecting to see the participation of 7-8 state-owned companies in the funding round.
“We will announce it next month,” LinkAja chief executive Danu Wicaksana told media reporters on the sidelines of the Indonesia Banking Expo Summit held in Jakarta.
LinkAja was established through the merger of the e-wallet platforms of Indonesia’s largest telco firm Telkomsel, and lenders Bank Mandiri, BRI and BNI. It is also backed by lender BTN, oil, and gas firm Pertamina, insurance firm Jiwasraya and brokerage firm Danareksa Sekuritas.
So far, these state-owned firms have evinced interest to participate in the current round of funding. However, amongst others who have confirmed participation are railway operator Kereta Api Indonesia (KAI), toll road operator Jasa Marga, flag carrier Garuda Indonesia, bus operator Damri, insurance pension firm Taspen, airport operators Angkasa Pura I, and Angkasa Pura II.
Earlier this year, in June, a filing with Indonesia Stock Exchange (IDX) had indicated that the stake of Telkomsel in Finarya will be diluted to 25 per cent once the companies participate in the round. Telkomsel currently owned a 65 per cent stake in Finarya.
Danu did not indicate the corpus that the company is planning to raise in its Series A round.
LinkAja’s plan to raise its next round of funding in Series B will be conducted in the first or second quarter of next year.
Danu said in an interview in August this year that “when there is a fundraising plan, management would ask the existing investors whether they want to top up their funds or they do not want to participate. If they back off, we will be looking for other prospective investors, but preferably state-owned enterprises or institutions.”
Finarya recently made headlines since the country-fifth largest lender Bank Tabungan Negara or BTN has reportedly delayed its plan to purchase a minority stake in Finarya, the lender’s finance director Nixon Napitupulu said.
He added that the establishment of its venture capital firm has not yet been completed. The lender is still in the process of acquiring a VC firm with smaller assets: Jayapura-based Sarana Papua Ventura.
Through its own VC firm, the lender will inject the fund to Finarya for the series B funding round next year. Previously, BTN expressed interest to acquire 7 per cent to 7.5 per cent stake in LinkAja.
LinkAja has partnered with smaller ride-hailing firms Bonceng and Anterin, and is currently listed as a payment option in Gojek, and Grab.
It, in fact recently joined the Gojek payment ecosystem, a move that enables its users to buy tickets for movies, concerts, among others, on the latter’s app, through the ticketing service GoTix.
On the Grab app, users can now pay for GrabBike, GrabCar, and GrabExpress services using the LinkAja payment option.
Going forward, the company will also offer PayLater, an instant-loan service to users by the end of this year, thereby partnering with local lenders and fintech firms.
LinkAja has around 32 million users, and it targets to have 100 million users by 2020.