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Claudia Chong · · 2 min readGoTo, TikTok to launch BNPL service in Indonesia
Photo credit: GoTo Group
Indonesian tech company GoTo Group is gearing up to launch a buy now, pay later product with TikTok, months after the two firms closed the merger of Tokopedia and TikTok Shop.
GoTo is doubling down on financial services to drive top-line growth as it seeks to convince investors of its long-term earnings potential.
The group’s fintech unit recently snagged David Chen, the co-founder and former CEO of BNPL platform Atome. Chen now heads GoTo’s consumer lending and BNPL business.
In an earnings call upon the release of GoTo’s fourth-quarter 2023 results on March 19, GoTo Financial head Thomas Husted said BNPL has shown promising growth prospects.
“Our goal and our aim is that GoTo Financial ends up as the most preferred partner with both TikTok Shop as well as Tokopedia’s platform,” said Husted, who also serves as GoTo’s COO.
Other players that also offer BNPL services in Indonesia include Akulaku and Kredivo.
In December 2023, GoTo agreed to cede operational control of Tokopedia in a bid to halt the platform’s rapid loss of market share in Indonesia.
With the merger, TikTok will invest over US$1.5 billion in a joint venture that it will control, without additional dilution to GoTo. In exchange, GoTo is expected to gain a steady revenue stream.
Husted said in the earnings call that GoTo is focused on product integrations with TikTok Shop, though the priority lies in ensuring compliance with the regulations set out by Indonesia’s Ministry of Trade.
See also: TikTok Shop gets winning hand in Indonesia via Tokopedia mega deal
Financial services, though a slice of GoTo’s overall revenue, is expected to be a significant driver of the group’s growth. In Q4 2023, gross revenue from the firm’s financial technology business rose 25.8% year on year to 605 billion rupiah (US$39 million).
The loan book of GoTo’s consumer lending business, comprising its BNPL and cash-loan offerings, grew by 32% quarter on quarter to 1.9 trillion rupiah (US$120.9 billion).
Payments app GoPay has also been attracting “a large number of users that are coming in unsolicited” to apply for cash loans, said Husted in the earnings call.
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This is part of GoTo Group’s efforts to double down on financial services to drive top-line growth.
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