A virtual bank will soon be coming to Indonesia. WeLab, a Hong Kong-based fintech unicorn, announced on Tuesday the acquisition of Bank Jasa Jakarta (BJJ), an Indonesian commercial bank.
With the deal, WeLab plans to launch a digital bank in the second half of next year to accommodate the country’s vast unbanked population.
A consortium led by WeLab has raised $240 million from existing and new investors in what the company says was the largest fintech funding in Indonesia this year. The capital will be spent on acquiring BJJ’s interests and “tech investments,” the company said.
The consortium, called WeLab Sky, will acquire BJJ’s interests to become the sole controlling shareholder. WeLab Sky has already bought a 24% stake in the bank, while the remaining majority shareholding will be transferred after obtaining regulatory approvals.
Backed by Hong Kong billionaire Li Ka-Shing’s TOM Group, WeLab opened its first digital bank in Hong Kong, a global financial hub, last year. The company currently operates a range of consumer fintech products in Asia, including the virtual bank and a loan product in its home city, as well as various types of loan services in mainland China and Indonesia. It also offers technology that provides enabling services to traditional financial institutions.
Tech companies have competed for Indonesia’s tech-savvy young consumers. Some of the more notable players include Xendit, a newly minted unicorn that provides digital payment infrastructure, Payfazz, which offers a mobile app for handling routine financial tasks, and GoTo, the payment gateway under GoTo behemoth.