Open Finance Startup Ayoconnects APIs Enable Financial Inclusion In Southeast Asia

Ayoconnect's Southeast Asian-focused APIs are accelerating the adoption of new financial services for businesses rather than building their own technical infrastructure. It is also licensed by the Indonesian Central Bank, allowing it to offer more services. Today, the government-funded startup announced the completion of a $13 million Series B upgrade round led by SIG Venture Capital, with participation from CE Innovation Capital and PayU, payments and fintech investor Prosus. This brings the total to $43 million, including an oversubscribed Series B led by Tiger Global, which closes in January 2022.

Ayoconnect was founded in 2016 by a team of approximately 250 people and is currently working to increase financial intensity for Indonesian consumers and SMEs. It works with existing regulators and banks and was recently licensed as a Tier 1 payment service provider by Bank Indonesia (BI). Ayoconnect claims to be the only open finance player in Indonesia licensed by the central bank.

The new Ayoconnect funds will be used to leverage the Ayoconnect C-suite, products and technologies, including new payment, information and banking solutions, as well as new account opening and card issuance APIs.

The startup recently launched regular direct debits for seven of Indonesia's largest banks (Mandiri, BRI, BNI, CIMB Niaga, Danamon, Bank Syariah Indonesia and Bank Neo Commerce). This allows Ayoconnect customers to use the direct debit API and periodically withdraw funds from customers' savings accounts at multiple banks.

Prior to creating Ayoconnect, founder and CEO Jacob Rost was the head of Lazada. After leaving Losada, he spent several years in Indonesia, where he saw how the country could benefit from greater digital financial inclusion. For example, it is the fourth largest country in the world by population, but about half of the population has no bank accounts, he said. It also has a complex geography, resulting in weak financial infrastructure, fragmentation and less standardization in banking. In addition, Rost added, Indonesia's consumer-facing businesses lack a digital financial infrastructure to manage their finances while serving customers.

Ayoconnect recovered so quickly from the closure of the first Series B because it grew so quickly after acquiring a BI license and securing key strategic partnerships. Growth said the new capital would bolster Ayoconnect's balance sheet and set it up for further growth over the next few years.

The platform currently serves 200 API clients, including major banks, financial institutions, tech unicorns, and fintech companies, and offers over 4,000 integrated financial products. Its APIs cover two categories: Open Banking APIs and Payment Services APIs, with the goal of building the most comprehensive open finance stack in Southeast Asia.

Some examples of financial services used by Ayoconnect customers include the aforementioned direct debit and integrated finance (the company has partnered with PT. Kereta Api Indonesia [KAI], the state-owned railway operator in Indonesia) to create new ticketing and performance activation features. KAI Access mobile app that allows users to buy airtime, internet subscriptions and electricity tokens). It is also partnering with Indonesia's largest Islamic bank, Bank Syariah, to add new digital and mobile capabilities to improve customer financial inclusion and economic growth.

Brick, Finverse, Brankas and Finantier are other Southeast Asian open finance startups. One of the distinguishing features of Ayoconnect is that it is the only licensed open finance platform in Indonesia, allowing it to offer solutions that are not yet on the market.

“While Open Banking and Open Finance has done fairly well in Europe and the US, the industry in Southeast Asia is still very young but growing fast. In Indonesia, hundreds of millions of people are using new digital services, and many still do not have them. ... access to basic financial services such as bank accounts,” Rost said.

“Therefore, there is a lot of potential for open finance in the region and a lot of room for future growth in this sector. We were very excited to see activity in space and play a role in the development of the ecosystem. »

Akshay Bajaj of SIG Venture Capital said in a statement that the Ayoconnect team “has been working with APIs at scale for many years and is incredibly well positioned to help customers launch use cases in a fast and secure way that is attractive and inexpensive. Efficiency. With their enhanced capabilities, Ayoconnect and API banks continue to enjoy high and growing demand from their customers. We love their vision and believe they have the potential to transform and improve the future of payments in Southeast Asia.