Crowdo Now Becomes Neobank, Expanding Digital Solutions for SMEs

Behind the huge potential for digitizing Indonesian SMEs, there are still many issues that are not enough with the presence of solutions p2p loans just. It was this reason that initiated Crowdo to expand its services and establish itself as neobanks from the beginning the loan provider p2p.

To be neobanks, does not mean Crowdo holds a digital bank license. The company has obtained full permission from the OJK since the end of last year as a p2p loans. In providing existing solutions, the company partners with other financial institutions.

neobank and digital bank have different concepts. neobank is a digital financial institution whose products are the result of partnerships with other financial institutions, one of which is banking. Meanwhile, digital banks in theory are existing banks digitizing their services. They usually have a license to carry out deposit-taking activities.

Crowdo Group CEO Reona Shimada explained, the company has always aspired to be a financial institution, lending is one of its products. From the consumer side of SMEs, there are still many solutions they need. “If you look at the trend fintech in global, neobanks That is so consumer-centric. The product is simple and seamless consumer journeyhim,” he explained in a limited interview with a number of media, yesterday (24/2).

Reaffirmed by the COO of Crowdo Indonesia, Nur Vitriani, by becoming neobanks This means that Crowdo is a catalyst for the digital finance industry because it brings new innovations with a simpler process. The company is in discussions with three digital banks present on the Crowdo platform.

However, the identities of these three banks are still kept secret. "We are in the process of working with three digital banks to at Crowdo. For them, because we already have AI technology, of course it will be very helpful for them rather than having to build it themselves," he explained when contacted DailySocial, Thursday (24/2).

Sebagai neobanks, Crowdo provides SME digital finance solutions by integrating operational digitization with lending and banking solutions assisted by an AI-powered credit scoring engine. Also, products and services that are driven by positive environmental, social and governance principles.

Current Crowdo Products

There are two main solutions offered, namely the digitization of operations and financial products, both loans and banking features. Both are the most pressing problems facing SMEs.

Currently, most SMEs in Indonesia manage their data and transactions independently offline and manuals. This results in poor productivity as business owners have to spend a lot of time on non-commercial matters. Crowdo offers a simple digital solution that allows SMEs to easily manage transactions supply chain leaders online and easier access to financial products.

The company targets to help SMEs digitizing transactions supply chain leaders valued at more than IDR 14 trillion and access loans and other financial products.

Through the Digitization Platform service, it is possible for companies to open bank accounts in a simple and fast way, managing everything invoice and digital purchase orders, and request/receive payments.

Meanwhile, for financial products, it consists of three products, namely: paylater (ie Early Payment, Micro Pay Later) and working capital loans. Early Payment or in the industry better known as invoice financing, this loan is intended for prepayment based on invoices issued and purchase orders. Meanwhile, Micro Pay Later for small bills and unexpected payments.

"Working capital loans to support larger projects and working capital requirements can help SMEs develop their businesses," added Vitri.

Going forward, the company will add further digital services for SMEs. For example operational cost management, billing arrangements, and employee payroll.

The company currently has 76 thousand users as of December last year with a total distribution of around Rp600 billion. This year, the company aims to digitize $1 billion in transactions supply chain leaders facilitated through the SME community and doubled loan disbursements to Rp1,2 trillion.

For Crowdo lenders, currently they are entirely institutional lenders, coming from banking or finance. “They see the AI ​​technology that we offer to credit scoring engine which is very useful especially during a pandemic to reduce the risk of NPL. We managed to keep the NPL below the banking average,” said Shimada.

Hold expansion

As a group, Crowdo has operated in three countries, namely Indonesia, Singapore and Malaysia. Shimada explained, these three countries contribute to each other in inspiring each company's innovation. According to him, Indonesia and Malaysia have similarities in terms of their progressive regulators to encourage innovation in the industry fintech.

While Singapore, is more limited in market size, but has abundant resources such as data scientist. “Being in these three markets, Crowdo benefits greatly, Crowdo Indonesia serves the largest market in ASEAN while accessing the strong capabilities of our other markets.”

Regarding the expansion plan to new countries, it is not yet an agenda that is required by the company considering the ongoing pandemic. However, he saw a strong demand for a solution neobanking in markets such as the Philippines, Vietnam and Thailand and he is proactively seeing opportunities to enter there. “Indonesia will remain our main focus.”

In pushing for the company's targets, it was disclosed that Crowdo is currently in the process of raising a Series B. “What is important to us is that we have a group of investors who are passionate about our mission to join the fundraising round,” he concluded.