Komunal, an Indonesia-based fintech company, has on Tuesday announced that it has successfully secured $8.5 million of funding led by East Ventures (Growth fund).
This funding round is also participated by AlphaTrio Sustainable Technology Fund, Skystar Capital, Sovereign’s Capital, Ozora, and Gobi Partners, Komunal said in a statement.
According to the statement, this fresh fund will be used towards the company’s mission, which is to accelerate financial inclusion and strengthen the neo-rural bank ecosystem in Indonesia, especially outside the Greater Jakarta area.
“We are humbled by the overwhelming support from our investors, rural bank partners, and loyal users,
“It was very fulfilling to see how digitalization has helped our rural bank partners to thrive during the pandemic recovery period and enabled our loyal users to access attractive deposit and loan products digitally,” said Hendry Lieviant, Chief Executive Officer of Komunal.
In 2023, he hopes to reach a wider market, particularly BPR (Bank Perkreditan Rakyat) users and partners outside of Java and Bali.
“We are optimistic that the collaboration between fintech and incumbent banks, including rural banks, will create a very strong synergy. Komunal sees the potential for partnerships with BPRs to increase financial inclusion for micro, small and medium-sized enterprises (MSMEs) in tier 2 and 3 cities,” he added.
According to Komunal, the fintech industry has enormous potential in Indonesia, particularly for fostering the growth of MSMEs.
It noted that fintech can help small and medium-sized enterprises (SMEs) manage their finances and capital with convenience and efficiency.
It also noted that Komunal, the fintech company to digitize BPR in accelerating the financial inclusion in Indonesia’s tier 2 and tier 3 cities, has in 2022 channeled $230 million worth of deposits and loans to local BPRs and MSMEs.
This represents 350 percent year on year growth compared to 2021, where the number of deposits and loans disbursed was $50 million.
Meanwhile, its transaction volume is expected to exceed $500 million by 2023.
Komunal has also recorded positive earnings before interest, taxes, depreciation, and amortization (EBITDA) since October 2022, experiencing growth and profitability at the same time.
Since its launch, more than 220 BPRs (rural banks) from across 19 provinces in Indonesia have joined the DepositoBPR by Komunal platform.
This enables users throughout Indonesia to make deposits digitally with hundreds of BPRs across the country without physically visiting the banks whilst enjoying higher interest rates on government-guaranteed deposits.
Currently, Komunal has two main business lines: DepositoBPR by Komunal and Komunal P2P Lending.
Both of these companies are involved in the fintech industry and have a mission to accelerate financial inclusion in Indonesia.
DepositoBPR by Komunal is the first marketplace application for BPR bank deposit products throughout Indonesia. The platform was launched by Komunal to help BPRs go digital and connect more easily with customers.
Komunal P2P Lending, on the other hand, is a peer-to-peer lending platform that connects potential MSMEs with lenders to support economic growth in Indonesia.
“As the early supporter of Komunal, we have witnessed the growth and many achievements of Komunal. We believe in the resilience and innovation that Hendry and the team have and will continue to present, which will further accelerate digitalization in the financial sector,
“We are excited to continue seeing Komunal’s contribution in realizing financial inclusion for Indonesians,” said Willson Cuaca, Co-Founder and Managing Partner of East Ventures.
Meanwhile, Komunal announced the appointment of Dr. Peter Jacobs as Commissioner effective January 1, 2023.
Dr. Peter Jacobs has worked for Bank Indonesia since 1991 and has held a variety of strategic positions, including coordinator of the 2018 World Bank and IMF meetings.
His previous position at Bank Indonesia was Executive Director – Head of the Banking Service, Licensing, and Treasury Operation Department from 2019 to 2022.
“We are delighted to welcome Dr. Peter Jacobs to Komunal. His extensive experience at Bank Indonesia will be invaluable and will certainly bring new color and perspective to elevate the entire Komunal team,” said Hendry.
Dr. Peter Jacobs stated that Komunal’s initiative to create a strong synergy with BPRs throughout Indonesia is a smart innovation that can promote financial inclusion.
Along with Dr Peter Jacobs appointment, Komunal plans to make several senior hires to further accelerate its mission in providing the best service to MSMEs, rural banks and the society at large.