UangTeman secures seven-figure Pre-Series A
By Masyitha Baziad September 27, 2016
- Raised S$1 million in debt financing, to expand to Surabaya
- Appointed Singapore IT veteran Steve Ting to join its board
JAKARTA-based pioneer for online direct lending PT Digital Alpha Indonesia (UangTeman) has secured a seven figure Pre-Series A funding round led by an undisclosed large South-East Asian (SEA) banking group, its chief executive officer (CEO) Aidil Zulkifli confirmed to Digital News Asia (DNA).
Two Indonesian private investment groups also participated in the investment round. UangTeman previously received its undisclosed seed-funding round from Indonesia’s Alpha JWC Ventures.
Besides securing the funding, UangTeman also raised S$1 million (RM3.04 million) in debt.
“We look at debt financing as an efficient way to underwrite our loans off our balance sheet, while the equity funding is best used to grow the business through operations and marketing,” Aidil said in an email to DNA.
With the Pre-Series A funding secured, Aidil said that UangTeman is looking to raise its Series-A in the first quarter of next year.
The financial technology (fintech) startup will use the fresh capital to expand its marketing and strengthen its existing operation in greater Jakarta area, Bandung, as well some cities in Central Java such as Solo, Klaten, and Magelang.
It will also help UangTeman to expand to other major cities before the end of the year.
“We are planning to open an office in Surabaya, Indonesia’s second largest city, to serve customers in the East Java area by the end of November,” he added.
Besides expansion, UangTeman will also use the additional funding to strengthen its engineering capabilities, especially in its big data infrastructure.
Being a non-bank institution and currently unregulated by either Financial Services Authority (OJK) or Bank Indonesia, UangTeman does not have the access to collective credit information database called debtor information system (SID), hence it leverages on its big data algorithm for credit risk measurement.
“Improving our big data infrastructure will improve the speed of loan approvals and disbursement,” Aidil said in an official statement.
UangTeman loans start from Rp1 million (US$76.70) up to Rp2 million (US$153.50) for first time borrowers.
Launched in 2015, UangTeman claimes it has digitally disbursed more than Rp25 billion (US$1.92 million) loans while maintaining a lower than 3% non-performing loan (NPL) ratio, which is lower than Indonesian banks average NPL.
New board director
As part of the new funding round, UangTeman also appointed Steve Ting to be its board director.
Ting is an IT industry veteran and was the founder of Singapore-based Frontline Technologies, which was acquired by British telecom giants BT Group in 2008 for US$202 million.
“We are proud to have received the confidence of a fund managed by a major financial institution, on top of that, we are also thrilled to have Steve Ting joining our board to help us drive our vision to be Indonesia’s and eventually SEA’s best and safest digital lender,” Aidil said in a statement.
Ting who is also an active investor and mentor in Singapore currently sits on few boards including Singapore-based technology company W-Locate. He also serves as deputy chairman of Ngee Ann Polytechnic’s electronic and computer engineering advisory committee.
“Indonesia has a vast untapped fintech market, and we envision UangTeman to be the catalyst of digital financial inclusion in this exciting market,
“We are impressed by UangTeman’s proactive efforts in engaging the regulators in Indonesia for establishing fintech regulatory framework,” Ting said in a statement.
In a proactive move, UangTeman previously released a policy-paper and submitted it to Indonesia’s Financial Services Authority (OJK), suggesting self-regulation. At the same time its paper helped the regulator to better understand both UangTeman’s business model, as well as the nascent fintech sector.
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