Payfazz Announces Investment of 428 Billion Rupiah To Startup Payment Gateway Xfers [UPDATED]

Payfazz announces strategic investment in startup payment gateway from Singapore Xfers. This rumor has actually started since May 2020, but CEO Payfazz Hendra Kwik always denied it when asked for confirmation by DailySocial.

On May 19, 2020, he argued that currently the relationship between the two companies is solely business partners. Until we found the Xfers logo emblazoned under the Fazz Financial logo at the Payfazz office. However, on January 26, 2021, Hendra still denied it.

Under Fazz Financial, there is also People's Capital. In addition, also invest in the recently acquired Credibook Pre-Series A . funding.

Through strategic investment, Payfazz and Xfers will become part of the newly formed entity, Fazz Financial Group (FFG). to jointly achieve the mission of providing financial inclusion across Southeast Asia. This becomes an inter-country transaction firstly, between two fintech startups in South East Asia.

It was said that the investment value made by Payfazz for Xfers was $30 million (more than 428 billion Rupiah). It was also mentioned that Hendra will be the CEO of FFG, while CEO Tianwei Liu will be the Deputy CEO. Robert Polana, former CFO of Tiket.com, joined as CFO of FFG.

This next investment step is expected to encourage the two companies to develop their business in providing more collaborative services for all of Southeast Asia.

As a note, brand This Fazz Financial was actually introduced by Hendra during an interview with us in February 2020, because Payfazz has carried out various business expansions so that a business group was formed.

Separately, in a virtual press conference held today (4/3), Hendra said that both Payfazz and Xfers will have their own independence in achieving their goals. Payfazz will focus on the Indonesian market first considering that there is still a lot of unexplored potential.

Meanwhile, Xfers will function as a B2B service from FFG - focused on connecting external customers to the payment infrastructure and user network aggregated by FFG. Xfers will continue to focus on expanding its presence to a number of countries in Southeast Asia, considering that the company already has a presence in three countries. Although it is possible that in the future Payfazz will expand its business.

"Think of it like Amazon is Payfazz and AWS is Xfers. AWS is already everywhere building cloud infrastructure, while Amazon is only present in a handful of countries because these two things are different [in terms of challenges and regulations]. Independence is very important, we [Payfazz ] don't want to limit their operations, nor do we want to follow Xfers' strategy," said Hendra.

He added, however, if in the future Payfazz has the opportunity for regional expansion, of course the process will be smoother because it can directly utilize the API infrastructure that Xfers has built.

The reason Payfazz is interested in investing is actually also motivated by the long-standing partnership between the two companies. In addition, both are graduates of the Y Combinator accelerator program.

Hendra views that the API technology built by Xfers is very helpful in the integration process with B2B clients in targeting more people unbanked with financial services. Thus, the more B2B clients that Payfazz has successfully recruited, the more inclusive a digital financial service will be.

"So we [Payfazz] can focus on pursuing better growth because instead of building our own API, the costs that should have been incurred can be transferred to Xfers."

Currently Payfazz has 250 thousand registered agents serving more than 10 million people unbanked in Indonesia.

Awal Xfers' presence in Indonesia began in 2016 after securing an initial $2,5 million in funding led by Facebook Co-Founder Eduardo Saverin, Golden Gate Ventures, 500 Startups, GMP Venture Partners, and Partech Ventures.

In 2019, they released Straits, the first initiative supported blockchain to advance the open financial ecosystem in Singapore powered by Zilliqa. Xfers' business partners in Indonesia are not only with Payfazz, there are also Indonesian Porters, Faspay, Modal Rakyat, and Tunai Kita.

Tianwei said, in the second quarter of 2021, the company will launch two new products. First, a seamless payment solution targeted at Singapore-based merchants. Second, a single integration solution to connect companies/entrepreneurs with fintech who wish to enter Southeast Asia with local payment methods in the region. This is also supported by assistance to reach consumers who do not have access to banking.

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*We added a statement from the virtual press conference held by FFG