Payfazz Still Raising Series B Funding, Preparing for Regional Expansion

Agency-based financial services startup Payfazz revealed that it is holding a Series B funding round. These fresh funds will later be used for the development of financial products outside of PPOB, strengthening the R&D team, and regional expansion. At least one or two countries in ASEAN will be visited.

To DailySocial, Co-Founder and CEO of PayFazz Hendra Kwik has not provided further details when the finalization of the funding will be completed. According to him, the Series B funding has not been closed or is still looking for other investors to join.

"There are many [investors], most of them are strategic financial sector. Combined from investors hedge funds, there is late stage investors and strategic financial services investors. The process is still we go because we haven't closed yet [raising]," said Hendra.

A number of investors who invest funds in Payfazz including Y Combinator, Insignia Ventures Partners, MDI Ventures, Vertex Ventures, Convergence Ventures, and has been rumored to have received funding from Tiger Global Management since last month.

Regional expansion, he continued, is included in the context of realizing its ambition as a regional company. He believes that the Payfazz line is in accordance with the needs of rural communities for financial products. From the institution's recognition through the award obtained by Payfazz, it adds to the belief that best practice This can be brought in for export abroad.

"There are several countries in ASEAN that can be replicated [with lessons from Indonesia]. Maybe enter one or two countries first, but we don't know if this year because we are still studying which one is the most strategic."

Strengthening the R&D team is a trend that is always done when Payfazz has more budget, the majority of the funds are allocated there. Hendra views the R&D team as having an important role throughout the company's existence. There it became the forerunner of a new service issued by Payfazz.

"Every time there is a demand in the market, we always validate it, to see if the request is valid or not. Then look at the potential, is it possible?" saturated or the market is still wide, is there any business potential and have sustainability the strong one,"

He continued, "If it's good, we'll try to find an outside candidate to be the internal CEO for lead the product. We hired, if you get a good team and the idea is valid, we will support with internal funds and let them scale up."

Focus on serving basic financial products

Hendra admitted that the literacy of financial products in the village is still low, so it is not appropriate to try them with products that do not yet have a close correlation with their daily needs. As a result, when Payfazz was initiated in 2016, the product offered was PPOB because it was the easiest for them to understand.

"This PPOB makes people familiar with brand Payfazz. We are also increasing the locations of Payfazz agents. After four years, they are often used, finally our reputation is getting better, the network is strong. Then it was decided to distribute financial products outside PPOB."

The contribution of PPOB alone every month almost touches Rp. 1 trillion. Growth in general when averaged between two to three times per year. It was stated that the number of agents reached 450 thousand people, the number of registrations reached 2,5 million downloads. Nearly 40% of them are concentrated on the island of Java.

This figure makes Payfazz as one of the biggest financial agent players for segmentation in rural areas.

After PPOB, actually towards the end of last year the company began to enter into a variety of loan products and bank transfers as the next level of basic financial products. For company loan products, strategic collaboration with startups lending People's Capital.

The product is called Agen Kredit to support the business continuity of Payfazz agents by providing unsecured business capital loans. The nominal funds given start from Rp. 500 thousand to Rp. 2 million.

The transfer feature that has been added in the Payfazz application allows users to transfer money to all banks.

"Product development always looks at the needs of consumers no understand what [the product is made] for. Previously there was only PPOB, now there are additional bank transfers, loans want to be strengthened, and we are considering savings."

Introduction of two products and rebranding Become a Fazz Financial

In fact, apart from its focus on reaching rural communities with access to financial finance, Payfazz releases various products that reach various consumer segments. There are Post, Sellfazz, Sellfazz POS, Fazzcard, and Canfazz. The first three products are online cashier applications that target different types of businesses.

While Fazzcard is an application for submitting cash receipts to finance daily needs, credit, data packages, basic necessities, gasoline, without having to have a bank account. In addition, offering cashback when shopping through Fazzcard's e-commerce partner.

Last is Canfazz. The spirit offered is actually similar to Payfazz, as an educational agent for financial products in rural areas. The difference is Canfazz is an agent mobile devices who 'pick up the ball' to residents' homes to explain financial products.

Meanwhile, Payfazz's agent is static because it is in the form of a shop, so to carry out its function as an educator it will only happen if residents come to the shop to ask further questions.

"Initially, we used Canfazz for internal sales management who came to the field to educate agents and the public to understand how to use Payfazz.scale up because we consider it sufficient as a financial product educational tool."

Canfazz agents are tasked with conducting product sales, field surveys, and installing promotional tools in designated stores. In the future it is possible to open savings through them.

"This initiative only started in 2019, it turns out internal sales we are quite effective for education. But if hired myself will be cost. That's why we are thinking of recruiting local people who want to get it income In addition, there is a commission they charge when a conversion occurs."

The increasingly comprehensive variety of financial products prompted Hendra to take the decision to rebrand Payfazz to Fazz Financial as the parent in charge of various financial products.

"From the beginning it was only for payments, now it has been transformed into a holistic financial product. So we are rebranding."

Interestingly, Payfazz's superior position in the PPOB segment has made the company finally create a subsidiary that specifically provides its API (host-to-host/h2h). This company is called Billfazz (PT Billfazz Teknologi Nusantara) whose release is close to Canfazz.

Hendra explained that Payfazz has quite comprehensive payment partners from various companies and governments. The company that was once a PPOB provider for Telkom, the volume of transactions soared high only from Telkom.

"From there, we decided that more and more companies wanted to integrate with us. But because Payfazz is a platform, it can only be connected with one API, so Billfazz was created. So companies that develop PPOB can integrate their API with Billfazz."

It is said that there are thousands of partners who have been connected with Billfazz to enter the PPOB ecosystem. The variations range from government bills, taxes, telephone bills, e-wallet, and banking. Billfazz users include Blibli, Traveloka, Tokopedia, Mapan, Flip, and others.

Of all the Payfazz series, which mostly focus on B2B2C, Hendra said that currently the company has made a profit but is not yet positive. "This year should be positive if for example hiring stops, but we continue to invest there, speltIt's big," he concluded.