Will Ovo complicate a Gojek-Tokopedia merger?

If it pushes through, the Gojek-Tokopedia merger would be a significant event in its own right. But the deal could also put into question an established alliance in Southeast Asia’s tech industry.

At the heart of it all is payments. Before the talks, ecommerce player Tokopedia had been firmly in super app Grab’s camp as both companies own stakes in fintech startup Ovo. A merger could put GoPay, Indonesian decacorn Gojek’s payments service, front and center in Tokopedia – a huge coup.

Photo credit: KrAsia

Could this hurt Ovo down the line? Perhaps not, as the company’s growth has made it less dependent on Tokopedia. That’s according to a source close to Ovo, whose CEO Jason Thompson was formerly the head of GrabPay.

Still, things appear to be fluid, with regulatory complications to sort out with Bank Indonesia. At this point, it’s all a matter of how these companies can quickly reach their ultimate goal: Access the public markets and beat regional heavyweight Sea Group.

See more: Beyond FOMO: Why Grab should race to an IPO fast

The Ovo question

Being on Tokopedia has given Ovo an edge over GoPay. In a past interview, Ovo’s Thompson attributed the inflection point in the company’s growth to tie-ups with Grab and Tokopedia. These partnerships allow Ovo to process transactions that may be less frequent compared to ride-hailing but have much larger basket sizes.

A Gojek-Tokopedia merger could eventually hamper that.

“It’s a win-win for GoPay, because it gives them access to ecommerce players, which would enable them to compete with ShopeePay,” says Aldi Hartanto, vice president of investments at MDI Ventures. GoPay is currently not on Tokopedia, though it is present on platforms like Blibli, JD.id, and Tiket.com.

For Gojek, teaming up with Tokopedia could mean access to the platform’s millions of merchants – potential clients for GoPay’s productive loans – or collaborations between the two companies’ respective PayLater products.

Tokopedia co-founder and CEO William Tanuwijaya / Photo credit: Tech in Asia

Considered as the real money maker, financial services has been a priority for e-wallets in recent times. Gojek, for instance, had upped its stake in Indonesia’s Bank Jago late last year.

But Ovo may not be as concerned with these developments. The source says that while it was a big deal to partner with Tokopedia during its early days, Ovo’s growth over the past few years has reduced its dependence on the ecommerce platform.

What’s next?