Indonesian tech giant has reportedly paid around $159.5 million for shares in an Indonesian bank (PT Bank Jago) – which is part of a major Fintech deal. Gojek is competing with ride-hailing app provider Grab which is also focused on establishing regional Fintech services.
Gojek intends to allow users to open bank accounts with Jago and then manage their money via its app. GoPay, which is Gojek’s payments and financial services division, purchased nearly 1.96 billion shares at 1,150 rupiah per share, according to a recent stock exchange filing.
As first reported by Bloomberg, the internet giant used call options to finalize the transaction, completing the deal at a significant discount to Friday’s (December 18, 2020) close of 3,900 rupiah and paying around 2.25 trillion rupiah (appr. $159.5 million) in total for the shares.
Gojek now has a 22.16% stake in Bank Jago (when combined with its previous stake of 4.14% in the bank).
This latest transaction suggests that the firm plans to expand its Fintech-focused business. Gojek, which is Indonesia’s most valuable startup, is backed by Facebook Inc. (NASDAQ:FB) and PayPal Holdings Inc (NASDAQ:PYPL). The firm is now planning to allow users to open bank accounts with Jago Bank and then manage their funds via its app, according to a statement from the company. GoPay has been focused on extending digital financial services to merchants and drivers for the past few years.
Indonesia currently has the fourth-largest unbanked population in the world. Approximately 52% of adults (95 million residents) don’t have access to a bank account. Around 47 million Indonesians have very limited access to modern financial services.
The Jakarta-headquartered firm is now offering services in five Southeast Asian nations. Gojek’s apps have been downloaded around 190 million times (as of June 2020).
As covered in June 2020, Gojek’s digital wallet GoPay introduced gold investments via GoInvestasi through a partnership with Fintech firm Pluang. Budi Gandasoebrata, MD at GoPay, had noted that the rising demand for making investments via digital wallets had led to GoPay providing the new investment option.