eFishery Receives 500 Billion Rupiah Loan from Bank DBS Indonesia

Startups aquatecheFisheries and Bank DBS Indonesia announced a partnership in the form of a short-term loan (loan) worth IDR 500 billion. This is a first for both companies. For DBS Indonesia this is the first loan for the sector aquatech, while for eFishery is the first loan facility from the bank since the company was founded in 2013.

Regarding lending through the platform , DBS is already working with a number of local startups. Among them with Zenius with a commitment of 100 billion Rupiah, then joint financing limits with Kredivo worth 2 trillion Rupiah.

In a press conference held Friday (7/10), eFishery Co-founder and CEO Gibran Hufaizah expressed his gratitude for Bank DBS Indonesia's trust in the company to channel loan funds to realize its strategic plan. The funds will be used to accelerate the revolution in the aquaculture sector and improve the welfare of fish and shrimp farmers in Indonesia.

"With this support, we will expand our products and services internationally and have an even greater impact on the food sector," he said.

Director of Institutional Banking Group Bank DBS Indonesia Kunardy Lie said that his party is very pleased to be able to channel working capital loans to eFishery who are very visionary in utilizing technological innovations to modernize the aquaculture ecosystem by focusing on shrimp and fish ponds.

“Bank DBS Indonesia's commitment to partnering with eFishery is one of our forms of focus to grow the digital economy industry in Indonesia and is also part of our seriousness in managing business by paying attention to the issue of environmental, socialand governance (ESG)," said Kunardy.

When asked further, the consideration of eFishery is taking loan funds from banks rather than raising funds from venture capital, the reason is because funds from banks when calculated for the long term include cheap funds. When taking equity, there are valuable shares that must be released from the company for investors. Which, if the company grows up, to buy the shares again at a later date, then the price issued is more expensive than when it was first released.

On the other hand, when calculating from a bank loan, the cost is actually cheaper because it only looks at the interest that must be paid. Moreover, successfully getting a loan from a bank proves that now eFishery, as a startup aquatech be in a position that is successfully assessed bankable by banks. For him, currently eFishery is in a phase that requires not only VCs, but also other financial institutions that can support businesses to grow faster.

Gibran also wants eFishery in the future to become tycoon companies that are now leaders in the industry, which in the process initially relied on financial institutions to develop their business. “Now we are at the point where mature, large business scale, visible profit, more risk mature, so that we can grow revenue di market that predictable for us. This is also proof as company that feels ripe."

eFishery's ambition is quite big in developing solutions aquatechto the global market. Company eyeing expansion to India, then gradually to China or Vietnam. According to Gibran, the solutions developed by eFishery are more competitive than those already in the Chinese or Indian markets. This condition has succeeded in making eFishery's confidence to be able to replicate its success story in Indonesia to the next expansion country quite high.

“If this works, it could be historic because usually companies from there enter Indonesia. We are ambitious enough to be successful in Indonesia, creating a nine-year success story of eFishery in Indonesia that can be achieved in three years in India. Actually, we have 10 countries that we want to enter in these five years, but China and Vietnam will definitely come first.”

DBS Indonesia Bank support for startups

Kunardy continued that in the risk mitigation process, the company has assessed various aspects before lending to any company, including eFishery. In terms of risk, industry aquatech indeed can not be separated from risk, the most important is the risk of disease.

However, in terms of eFishery, they can balance these risks with supporting data to prevent disease. Among other things, providing an eFarm platform for shrimp farmers in which it is available disease prevention system. This feature contains a program to prevent disease outbreaks in shrimp ponds and solutions for managing water quality that are effective and environmentally friendly based on technology.

Shrimp farming is known to be promising but more disease-prone, so the features in eFarm are more complex than eFishery solutions for fish. “eFishery can bridge risk appetite banking by providing data to reduce risk in their business. This can give us comfort as a bank to channel credit,” said Kunardy.

For the record, lending to digital startups is actually not the first time for Bank DBS Indonesia. Previously, banks had disbursed loans to online travel agents (OTA) and Broom, a business platform provider startup showroom.

"In disbursing loans, we always look at it from various sides, it just so happens that many startups are still printing loss. Even though loss, we keep giving because we see the potential in the future. Is this startup already in the community and can make an impact. We can help them to keep growing.”

Until the end of this year, Bank DBS Indonesia will disburse two loans for startups. Although it cannot be identified, the startup is one that operates as a company super app and another in OTA. "The first, the loan is worth Rp. 1,4 trillion and the other is around Rp. 200 billion."

As for ESG loans, eFishery is the first startup in outstanding loans at Bank DBS Indonesia. There have been several initiatives carried out by banks, one of which is a loan for Indika Energy's subsidiary, namely PT Jaya Bumi Paser for $275 million. The company is engaged in renewable energy based on biomass.