Amartha draws millenials to invest in micro-businesses
By Yunnie Marzuki August 9, 2017
- Hosts short movie competition to create awareness among millenials
- Has disbursed approximately US$75 million to 40,000 SMEs
INDONESIAN peer-to-peer (P2P) lending marketplace PT Amartha Mikro Fintek (Amartha) encourages and targets “millenials” to invest in micro-businesses and SMEs through the Amartha Short Movie Festival.
The Amartha Short Movie Festival is a competition divided into two categories which are short documentaries with the theme empowering micro-businesses and short fiction movies with online peer-to-peer lending as the theme. Applications are open from August 8 to October 9, 2017.
“The reason why we took short movie as our medium is to create awareness among millenials to invest in micro-businesses and SMEs. They are tech-savvy, practical, and social media users which make them our potential lenders,” said Amartha chief executive officer and founder Andi Taufan Garuda Putra.
He also hopes that through this competition, he will be able to convey the message to millenials to look at microentrepreneurs and SMEs surrounding them and understand their value.
Judges of the competition are from film industry and participants have to successfully convey messages through short movies. The winners will receive a total cash prize of 350 million rupiah (US$26,250).
Amartha was founded in 2010 and is based on the group lending or collective borrowing concept where each group consist of 15 to 20 people. It has disbursed approximately 100 billion rupiah (US$75 million) to 40,000 micro-businesses and SMEs mainly in Java.
“I see a difficulty for Indonesian micro-businesses and SMEs in getting capital to develop their businesses. Most of them probably need a small amount of money to create a huge impact in their economy state.
“That is why I want to help by connecting them to individual investors and even banks. Individual investors for us are millennials and middle-income society,” he explains.
Lenders can invest through the platform with minimum amount of three million rupiah (US$225) and will receive returns between 15% to 20% per year.
They are allowed to manage their own portfolio on the dashboard and credit intelligence systems are designed to determine the optimum credit limit, level of profit sharing, and tenure.
Amartha gains based-on-commission revenue from “lender” and “borrower” for every successful transaction and it also claimed to be able to lend with a zero percent of non-performing loan rate for the past seven years.
Amartha received Series A undisclosed funding led by the Corporate Venture Capital (CVC) arm of Mandiri Group, Mandiri Capital Indonesia (MCI) on March 2017. Amartha aims to create more awareness for users and plan to extend access to borrowers this year.
“We would want to reach more SMEs, not only limited to city area but also villages. Because we are aiming to push “ultra-micro” businesses in Indonesia,” he says.