Fintech: Indonesian, Agent-Driven Banking Network PAYFAZZ Raises $53 Million
PAYFAZZ offers financial services to Indonesia’s rural and unbanked individuals.
PAYFAZZ, an Indonesian fintech start-up, scooped up $ 53 million in a Series B funding round led by B Capital Group and Insignia Ventures Partners. Existing investors Tiger Global Management, Y Combinator, ACE & Company, and Quiet Capital also participated in the funding. New investors included BRI Ventures. (Deal Street Asia)
PAYFAZZ raised $ 21 million from investors such as Tiger Global Management and Yuri Milner’s DST Global last year. It participated in the Y Combinator accelerator program in 2017.
Hendra Kwik, Jefriyanto, and Ricky Winata founded PAYFAZZ in 2016. The fintech focuses its services on Indonesia’s unbanked – which comprise about 66% of the country’s population.
The start-up deploys duly vetted off-line agents to function as intermediaries between banks and potential customers.
Customers deposit cash with these agents and receive in return a PAYFAZZ balance which they can use for everyday payments such as electricity or phones.
Payfazz’s network currently boasts of 250,000 agents, most of whom operate small stores.
Basically, the fintech extends the banks’ branches out to the countryside.
“Every branch has to serve thousands of people, it’s kind of overcapacity,” Kwij told TechCrunch in 2017. “The supply of the banks can’t accommodate the burgeoning amount of users. It’s the equivalent of being in the Union Square [in downtown San Francisco], and the people in Mountain View and Oakland would find it difficult to get there [if there were no local bankfronts].”
PAYFAZZ will use the new funds to expand across Southeast Asia and to further strengthen its financial services across Indonesia’s rural population.
“We see that fintech apps accessible through a smartphone will revolutionize the financial service industry in the region. We want to take part in this revolution by making bill payments, money transfers, loans, savings accounts, and investment services easily accessible through smartphones to accelerate financial inclusion across Southeast Asia,” said PAYFAZZ Co-Founder and CEO Hendra Kwik, as quoted by Deal Street Asia.
Related Story: World Bank Pushes for Financial Inclusion Via Fintech
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