Hong Kong fintech WeLab raises $240 million to acquire BJJ

A consortium led by WeLab has raised $240 million, which the company claimed was the largest fintech funding in Indonesia this year

Hong Kong-based fintech startup WeLab is leading a consortium to acquire Indonesian Bank Jasa Jakarta (BJJ) to launch a digital bank in Indonesia.

With the deal, WeLab is planning to launch a digital bank to capture the country’s enormous unbanked population in the second half of next year.

A consortium led by WeLab has raised $240 million from existing and new investors, which the company claimed was the largest fintech funding in Indonesia this year. The capital will go towards acquiring BJJ’s stakes and ‘tech investments’, the company said.

The consortium, called WeLab Sky, will acquire the stakes of BJJ to become its sole controlling shareholder. WeLab Sky has already bought a 24% stake in the bank, while the remaining shares for majority control will be transferred upon securing 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 centre, last year. The company currently operates a suite of consumer fintech products across Asia, including the virtual bank and a lending product in its home city, as well as several types of lending services in mainland China and Indonesia. It also provides technology ‘enabling’ services to traditional financial institutions.

WeLab’s experience in running a digital bank in Hong Kong will be an advantage in its Indonesia digital bank gambit. With digital banking in Indonesia still nascent, with few players including Singapore’s DBS’s Digibank and UOB’s TMRW bank, Simon Loong, founder and chief executive of WeLab believes that WeLab is uniquely positioned.

We have a 2 to 3-year head start on building and running a digital bank, a lot of companies are still talking about building a bank, we already have most of the products ready, said Loong.

In terms of user size, WeLab said it has amassed over 150,000 digital banking customers. Its online lending app for Southeast Asia, Maucash, which it launched through a joint venture with Astra International, has more than three million Indonesian users.