Gojek now owns nearly a quarter of Indonesia’s Bank Jago in $159m deal

Southeast Asian super app Gojek has increased its stake in Indonesia’s Bank Jago to 22%, as part of a strategic partnership to offer financial services to merchants and drivers in the country.

Photo credit: Gojek

The ride-hailing giant will pay 1,150 Indonesian rupiah (US$0.081) per Jago share for a total purchase price of 2.25 trillion Indonesian rupiah (US$159 million).

Gojek’s payments and financial services arm GoPay, whose legal name is PT Dompet Karya Anak Bangsa, will now have a 22.2% stake in Bank Jago, up from 4.1%.

The partnership will provide users with access to digital banking services through Gojek’s platform. This will allow Gojek users to instantly open a bank account with Jago and manage their finances via the super app.

The deal, however, won’t lead to a change in Jago’s ownership. Controlling shareholders Metamorfosis Ekosistem Indonesia and Wealth Track Technology will continue own a combined 51% of the bank.

“We believe that this strategic collaboration between a tech-based bank like Bank Jago and a super app like Gojek is the first of its kind in Indonesia and Southeast Asia and represents a new way to spur growth in digital economies,” said Kharim Siregar, Bank Jago’s president director.

Gojek and Jago are set to expand their digital payment services in an underbanked country that has seen a surge in digital payments fueled by the coronavirus pandemic.

See also: How could the Grab-Gojek merger impact Gojek in Vietnam?

The move also aligns with the vision of both firms to serve small and medium-sized enterprises (SMEs). Recently, Gojek announced the launch of GoStore, a solution that helps local microbusinesses and SMEs set up online shops.

Gojek is also on the path to profitability, with all its services generating positive margins on a product basis. In October, the company raised US$150 million from PT Telekomunikasi Selular, Indonesia’s biggest wireless network provider.

Update on December 19: The article previously stated that Gojek’s legal entity is PT Dompet Karya Anak Bangsa. That is incorrect. That is the legal entity for GoPay.