Investors in UangTeman struggle to claw back their money

Much of the news around UangTeman, the embattled Indonesian online lender, has revolved around its inability to pay outstanding salaries and other benefits to its former employees.

But a group of 11 individual investors, whose money became the loans that UangTeman disbursed to borrowers, is now speaking up, questioning when (or whether) their investments will be returned.

Since 2020, they have collectively put in 9 billion rupiah (approximately US$628,000) in UangTeman. That amount only covers the principal – i.e., it does not include interest and other fees.

Photo credit: UangTeman

One such investor is Edmund (not his real name), who told Tech in Asia that he has been trying to cash out his investments since March 2021. But like UangTeman employees, he was repeatedly told that he would be repaid once the startup receives a cash injection or gets acquired. (UangTeman reportedly found a buyer earlier this year, with the acquisition process to be completed by April.)

That said, Edmund notes that FTI Consulting – the firm handling UangTeman’s bankruptcy proceedings – recently contacted the investor group for further discussions. Tech in Asia reached out to FTI Consulting, but the company has yet to reply.

A gradual decline

According to the investors, they heard about UangTeman through a Telegram group that discusses investment opportunities. A convincing factor appears to be UangTeman’s operational track record (it had been in business for a few years by that point) and its online lending license from Otoritas Jasa Keuangan (OJK), Indonesia’s financial services authority.

UangTeman had also said that it was planning a pivot from consumptive loans to productive ones (i.e., loans for entrepreneurs and businesses, instead of payday cash loans that the startup had mostly disbursed), says an investor.

Belinda (not her real name) first invested in July 2020 for a three-month term. She had no trouble collecting interest income, and when the company offered an extension with higher interest rates, she agreed.

However, problems began appearing by early 2021. Some UangTeman investors who wanted to cash out their principals were told to wait while others ceased getting their interest income.

“I started receiving late interest payments in November 2020,” recalls Belinda. “In January 2021, I only received part of the payments, and by February 2021, I stopped receiving anything.”

UangTeman’s South Jakarta office has since been sealed by building management.

The other investors who spoke to Tech in Asia affirmed that by March 2021, payments of any kind came to a halt.

A murky view