Finfra, a one-stop shop for companies launching white-labelled lending products in Indonesia, has announced it raised US$1 million in funding. Finfra grew out of Indonesian startup Danabijak, which continues to operate at a profit. The funding round was a collaborative effort by DSX Ventures and Seedstars International Ventures, regional fintech experts Cento Ventures and Fintech Nation, Baltic-based startup support incubators FirstPick and BADideas Fund, and Silicon Valley-based Hustle Fund.
Finfra plans to accelerate product development and grow its engineering, data, and finance teams in an effort to boost revenue and further establish itself as a market leader within the Southeast Asian embedded lending industry.
Indonesia underwent a transformative period of digitisation
Indonesia underwent a transformative period of digitisation in the late 2010s and early 2020s, fueled by an influx of VC investment in e-commerce, logistics, and financial services. As a result, Indonesia’s internet economy has grown tenfold since 2015, reaching US$77 billion in annual gross merchandise value (GMV).
The pandemic accelerated this trend, creating a mass influx of new digital platforms that enable Indonesian entrepreneurs to launch asset-light business models. However, credit access remains low for businesses and individuals – so much so that only 3% of the population has a credit card. Offering credit and other financial services to existing customer bases can help boost user adoption, increase per-customer spend, deepen customer loyalty, and improve retention.
Funding for product development
Finfra’s APIs enable non-financial businesses to offer embedded lending for their own users. The collaborative, international funding round underscores investor confidence in Finfra’s team, experience, and market knowledge. The round will fund product development and personnel expansion amidst the enormous influx of digital businesses adopting/exploring/looking to offer embedded credit solutions across Indonesia.
Embedding financial products
Finfra enables underbanked businesses and non-financial digital platforms to embed financial products and services, particularly credit lending, into their own distribution channels. Its top-to-bottom approach ensures total regulatory compliance while providing a complete loan management system, scoring, portfolio analytics, and access to debt capital.
In areas where conventional banks refuse to go, Finfra provides sophisticated, business-friendly fintech solutions that drive financial inclusion. This is also essential in light of recent initiatives by the Indonesian Financial Services Authority (OJK) to reach financial inclusion targets of 90% by 2024 (compared to 75% in 2019) and improve access to sustainable and transparent financial services.