Go-Jek, Indonesia’s biggest ride-hailing service, agreed to acquire three local financial-technology companies, underscoring its ambition to become the dominant player in the country’s nascent digital-payments industry.
The deals bring together Kartuku, Indonesia’s largest offline payments-processing company; Midtrans, the nation’s top online-payment gateway; and Mapan, a local community-based saving and lending network, Go-Jek said in a statement Friday.
Collectively, Go-Jek and the three companies now process almost $5 billion of debit-card, credit-card and digital-wallet transactions for their customers, service providers and merchants. Go-Jek, Indonesia’s first 1 billion dollar startup backed by KKR & Co., Warburg Pincus and Tencent Holdings Ltd., didn’t disclose the value of the acquisitions.
The purchases are the biggest move yet for Go-Jek, which started out by introducing a mobile app in 2015 to let people book cheap motorcycle taxis in traffic-snarled Jakarta. Since then, the company has become a household name in its home country. It’s now Indonesia’s largest food-delivery business and the leading digital-wallet provider, with 900,000 drivers, more than 125,000 merchants and over 100 million transactions processed through its platform per month.
That has allowed the startup to become the leading mobile-based consumer platform in Indonesia, with 15 million weekly active users.
“We are now taking Go-Jek to the next stage," founder and Chief Executive Officer Nadiem Makarim said in the statement. “This marks a significant development in our position at the heart of Indonesia’s vibrant fintech industry."
He knows that when Go-Jek’s payment service – known as Go-Pay – works, the results can be powerful. Such a promise has sparked fierce competition with its archrival, Grab, in Indonesia’s digital-payments industry. Grab this week announced it is teaming up with Paytren, a popular Indonesian payments app. It acquired local e-commerce platform Kudo earlier this year.
Indonesia, home to 260 million people, is expected to add 90 million consumers by 2030, more than any other country outside China and India, according to a report by McKinsey Global Institute. Yet 96 percent of the population has no access to credit cards, while 64 percent has had no access to formal banking services for more than 15 years, according to a KPMG report.
Go-Jek’s customers now use Go-Pay for a wide range of services offered on its mobile app. Makarim told Bloomberg News last week his goal is to let his customers pay for coffee, groceries, tickets and other things outside the realm of Go-Jek’s services.
The CEOs of each of the three acquired companies will take senior management roles at Go-Jek. Kartuku’s Thomas Husted will become Go-Jek’s CFO, while Mapan’s Aldi Haryopratomo will lead Go-Pay, and Midtrans’s Ryu Suliawan will lead Go-Jek’s merchant platform. – Bloomberg