Astra and WeLab Refine Commitment to Bringing Bank Jasa Jakarta to Digital Transformation

PT Astra International Tbk (IDX: ASII) announced its acquisition of PT Bank Jasa Jakarta (BJJ). In signing the Shares Subscription Agreement (SSA), Astra through PT Sedaya Multi Investama acquired 1.138 million shares or about 49.56% of the total issued and paid-up capital.

Based on information disclosure on the Indonesia Stock Exchange (IDX), Astra disbursed IDR 3.87 billion in this transaction. Meanwhile, this agreement was signed on July 1, 2022.

Corporate Secretary Gita Tiffani Boer said the transaction was aimed at developing Sedaya Multi Investama’s business and investment.

In addition, the company also announced that Welab Sky Limited (WeLab) as a shareholder of Bank Jasa, will also increase its share ownership there. After completing the transaction, WeLab will pocket 49.56% of the total issued and paid-up capital at Bank Jasa Jakarta.

In December 2021, WeLab was known to have owned 24% of Bank Jasa Jakarta’s shares. This corporate action strengthens their commitment to build and operate a digital bank. Considering the potential is still great, including to reach the unbankable.

In a report entitled The Rise of Digital Banking in Indonesia published by DSInnovate, it is stated that the size of the digital banking market, globally, is estimated to have reached about US$ 12.1 billion in 2020 and will grow to US$ 30.1 billion in 2026 with a CAGR of 15.7%.

According to the OJK, the financial inclusion index in Indonesia reached 76.19% in 2019. In addition, the adoption of banking products continues to increase from year to year.

Until 2020, there are 351.7 million registered accounts in 110 banks (96 conventional banks, 14 Islamic banks). Meanwhile there are currently twelve digital bank applications that can be used by the public in Indonesia.

Astra and WeLab bisnis business relationship

Astra’s business relationship with Welab has been established since 2018 when the two companies formed a joint venture engaged in fintech lending, Astra WeLab Digital Arta. On the same occasion, the company also released the Maucash application, offering two loan products, Maucepat and Mauringan.

WeLab is a p2p lending startup that operates in three countries through seven financial product brands, including WeLend and WeLab Bank in Hong Kong; WeLab Digital, Taoxinji, Tianmian Tech in China and Gugu Wallet; and Maucash in Indonesia.

WeLab Bank has 50 million users and more than $10 billion in loans and WeLab has around 150,000 digital banking users in Hong Kong.

Meanwhile, the Bank Jasa Jakarta is a retail bank that offers loans, savings products, and banking services. The bank has eleven sub-branches and three cash offices with ATM networks joined in the Prima network in all major cities in Indonesia.

Strengthen Astra’s Digital Product Ecosystem

The Astra Group began to carry out digital transformation several years ago. This transformation uses three main strategies, namely modernizing the core business, creating new innovative sources of income, and investing in products in the digital ecosystem.

Several digital products that have been included in Astra’s digital product ecosystem include CariParkir, Sejalan, Movic, SEVA and mo88i. Throughout 2021, Astra is increasingly strengthening its digital product ecosystem.

In the first quarter of 2021, a subsidiary of Astra Financial launched the Moxa application aka Mobile Experience by Astra Financial.

The company has also launched AstraPay which can already be used in the Astra Group ecosystem. The following are the details of digital products that have been included in the Astra ecosystem.

Astra’s collaboration with WeLab has actually been established before. In April 2018, the two business entities formed a joint venture in the fintech sector, namely PT Astra WeLab Digital Arta (AWDA). They launched a fintech lending platform or online loan, Maucash, which operates under Astra’s PT Federal International Finance.