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Bukalapak dives deeper into digibank business with Standard Chartered
The recently launched digital banking service promises easy and secure access to financial services for around 110 million users and 20 million business owners in Bukalapak ’s ecosystem.
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A user watches BUKA's share price on Aug. 6, 2021, the day Bukalapak held its IPO. (Courtesy of Bukalapak)
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ukalapak, Indonesia’s first publicly listed tech firm, has announced it is collaborating with Standard Chartered to offer digital banking services to micro, small and medium enterprises (MSMEs) on its platform.
A product of that collaboration is BukaTabungan, a new digital banking service that widens the reach of Bukalapak’s platform using nexus, a banking-as-a-service (BaaS) solution offered by the London-based bank.
The newly launched digibank service is deemed easy to use, inclusive and secure for Bukalapak’s around 110 million users and about 20 million business owners in the firm’s ecosystem.
Victor Lesmana, president of commerce and fintech at Bukalapak, explained that the digibank service followed a strategic partnership with the multinational banking firm to broaden financial inclusion among Indonesia’s underbanked population.
“We are very excited, because this is in line with our mission to support the growth of MSMEs in Indonesia and continue to expand financial inclusion across the country. Our greatest appreciation to Standard Chartered for the trust and shared passion in this collaboration,” he stated in a press release on Monday.
BukaTabungan, he said, used completely paperless automation and security technologies employing artificial intelligence, biometric facial recognition and identity validation.
An account can be opened in five minutes, the tech firm promises, with no administrative fee for savings, up to 20 free transfers and cash withdrawals per month, as well as competitive interest rates on savings.
BukaTabungan users can also enjoy several special offers until the end of October, including a bonus interest of up to 7 percent on savings, direct cashback worth Rp 100,000 (US$6.71) for each successful account opened, a special referral program for Bukalapak users and special discounts for Bukalapak and Mitra Bukalapak users.
Andrew Chia, Cluster CEO, Indonesia and ASEAN Market at Standard Chartered, said the partnership with Bukalapak would advance the digital banking services landscape and technology ecosystem; particularly through the adoption of BaaS.
“We are proud to partner with Bukalapak to launch BukaTabungan, one of Indonesia’s first digital banking services, combining Bukalapak’s e-commerce ecosystem with Standard Chartered’s banking expertise,” he added.
Bukalapak currently serves 6.8 million online merchants through its marketplace as well as 14.2 million businesses through its online-to-offline platform, Mitra Bukalapak.
The company also has more than 110 million users throughout Indonesia, who mostly transact outside tier-1 cities.
Read also: Allo Bank investment boosts BUKA net profit in first half of 2022
The unicorn launched its venture into the digibank industry earlier this year by investing in Allo Bank, in which tycoon Chairul Tanjung’s CT Corp owns a majority 11.49 percent stake.
In the first half of the year, Bukalapak booked an operational profit of Rp 8.6 trillion, as opposed to the Rp 776 billion operational loss in the same period last year.
The company also registered a net profit of Rp 8.59 billion, a turnaround from the Rp 767 billion net loss seen in the first half of 2021.
The profit was mostly supported by its mark-to-market investment in Allo, which earned Bukalapak Rp 1.19 trillion at the beginning of this year.
Read also: Allo, Jago, Bank Neo Commerce wrap up H1 with strong growth
Allo, for its part, achieved a sevenfold increase in loan disbursement year-on-year (yoy) in the first half of this year and reported a decrease in its nonperforming loan ratio from 1.76 percent in the first half of 2021 to zero in the same period this year.
The digibank booked Rp 150.62 billion in net profit in the first six months of this year, almost a sixfold increase from last year. Meanwhile, Jago earned a net profit of Rp 28 billion, reversing a Rp 47 billion loss suffered last year.
Nailul Huda, who heads the Center of Innovation and Digital Economy at the Institute for Development of Economics and Finance (Indef), previously said the digital bank industry would continue seeing positive growth in the future, on par with the rapid shift to online transactions.
He noted the key to sustainable digital bank growth was the availability of its digital ecosystem, adding that some banks may be unable to compete due to an absence of this factor.
“The biggest [question] for digital banks remains how well they develop their ecosystem,” Nailul explained in early August when asked about the future of Indonesian digital banks.
