The Jakarta-based startup said it is currently undergoing the process of setting up a joint venture with an undisclosed local financial institution.
“So we will act as a platform provider, while our local partner will be the player as they are the one who understands the market most. This is exciting as we were able to get a lot of insight, as well as data, on Vietnam,” said Investree CEO and Co-Founder Adrian Gunadi.
Gunadi also explained that from the perspective of regulation, Investree will not be limited by reciprocal rules as commonly applied to conventional banking companies trying to expand internationally.
In such situation, regulators from both countries are usually required to make an agreement before the banks are able to enter a foreign market.
“The regulation will not be applied to us as we will use a local brand instead of the Investree brand. Besides, the reciprocal rule is more on banking institution, while fintech is borderless,” Gunadi said.
Investree also announced that it is going to launch a sharia-based lending service in July; the startup is currently on the process of applying for certification from the National Sharia Board (DSN).
Gunadi cited strong demand from both borrowers and lenders to set up a lending practice based on the Islamic law, and by far three small businesses from Jakarta and Surabaya have agreed to join in the pilot project.
He also said that several lenders, including those from countries such as Singapore and Japan, have also agreed to participate.
“We are going to test the market’s response by giving products, pricing, access, and structure that are similar to [sharia-based services] in conventional banks,” Gunadi said.
Since its founding in 2016, Investree has channeled IDR214 billion (US$16 million) to 626 small and medium-sized enterprises, and it is targetting to channel IDR400 billion (US$30 million) by end of this year.
The startup was recently named as one of the P2P lending startups to have secured operating license from Indonesian financial services authority (OJK).
It is planning to expand its reach to other cities in the Java island, starting with Semarang.
Image Credit: wihtgod / 123RF Stock Photo