The collaboration between the two fintechs will provide Indonesia with a new and fully automated RDF lending platform designed specifically for SMEs
Finfra, the lending infrastructure provider that operates in Indonesia together with its licensed peer-to-peer lending affiliate Danabijak, has announced a new partnership with Xendit that will bring automated collections of revenue-based financing to businesses across Indonesia. Xendit, the payment gateway solution designed specifically for the Southeast Asian market, has provided MSMEs with advanced payment rails and infrastructure since 2016. The partnership will bring an entirely new collections automation structure to the mass market in Indonesia, and Finfra, through its affiliate Danabijak, will be the first to roll it out to customers.
Together Finfra and Xendit have developed a new system of API-enabled bank accounts that can be opened on behalf of the borrowing party. Through these Finfra- and Xendit-built accounts, users can receive short-term loans, enabling business growth by providing needed capital and repayment flexibility that caters to their exact needs. Xendit’s Rekening Dana Fintech (RDF) feature then allows funds to be automatically debited from the borrower as corresponding revenue accumulates in their account. This circumvents the usual ratio that directs 20% of any incoming funds toward the loan repayment and keeps the remaining 80% in the borrower’s account. Borrowers agree to direct all revenues towards this account, and this revenue-based financing (RBF) product enables the lender to receive a portion of the revenues automatically until the loan is fully repaid.
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The popularity of revenue-based financing has grown substantially worldwide in the last decade, and the Indonesian MSME landscape is well-suited to further adoption. Finfra has made it its mission to bring modern financing solutions to Indonesia, and this Xendit partnership is one of the most significant strides forward within that mission. As is always the case with Finfra products, greater access to credit and nationwide economic growth are at the heart of this product rollout.
Reinis Simanovskis, co-founder and CTO at Finfra, said: “There’s quite a bit of ground to make up in order to truly modernise the lending landscape within Indonesia, and offering automated RBF loans is a major step forward. Xendit’s specific focus on Southeast Asia made them an ideal partner, and we’ve worked closely with them to make sure this product addresses the needs specific to this region. We see this as bringing an innovative new product to a market that is more than ready for it, and yet another way we’re supporting Indonesian SMEs in a global context.”
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Mikiko Steven, Managing Director at Xendit, said: “We’re incredibly excited about this partnership with Finfra through its affiliate, Danabijak, and this product, which finally provides the Indonesian market with the modern RBF program it needs. Simplifying and modernising payments has been at the core of our work since we founded this company, and we see this as a new implementation of that focus. To that end, it matters to us that we’re partnering with a company as focused on Southeast Asia and Southeast Asian SMEs as we are, and I’m extremely confident about the future of this product and this partnership.”
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