JAKARTA — Indonesia’s state-controlled lender Bank Negara Indonesia (BNI) plans to establish a venture capital arm with a corpus of between 600 billion rupiah ($42.9 million) and 700 billion rupiah ($50 million), an executive said on Tuesday.
“We will execute the plan in the second half of this year,” BNI finance director Anggoro Eko Cahyo told reporters at a press conference in Jakarta.
BRI plans to invest in Fintek Karya Nusantara (Finarya), the operator of mobile payment platform LinkAja, that recently launched its services this month after a much-delayed start.
LinkAja is an integrated e-wallet service that was created through a merger of the e-wallets of telco firm Telkomsel, and lenders Bank Mandiri, BRI and BNI. It is also backed by lender BTN, oil and gas firm Pertamina and insurance firm Jiwasraya.
DealStreetAsia has previously reported that the six state-owned firms had committed to jointly invest $80 million in LinkAja.
BNI’s investment in LinkAja, Anggoro said, will be executed in three phases. In the first phase, BNI will invest through its brokerage arm BNI Sekuritas.
“After that [the first phase], we will then invest [in Finarya] using our [own] VC fund in the second and the third phases,” he added.
For its own investment arm, BNI is still considering whether to acquire an existing VC firm or set up its fund from scratch. Besides Finarya, BNI will invest in startups aligned with its core lending business through the proposed VC fund.
Fellow lender BRI took the inorganic route to set up its investment arm. It acquired a 35 per cent stake in a venture capital firm called Bahana Artha Ventura (BAV) in November 2107 before eventually acquiring 97.61 per cent of the company in December last year. BRI Ventures will invest around $25 million in Finarya’s LinkAja.
BNI and BRI’s VC funds follow the footsteps of Indonesian telco firm Telkom, which operates MDI Ventures, and fellow lender Bank Mandiri, which set up Mandiri Capital in 2016.
DealStreetAsia earlier reported that MDI Ventures has set up a Singapore arm and started fundraising for its third vehicle. The corporate VC aims to tap external investors for the first time for its latest fund.
Its first fund was $100-million single-LP fund launched in 2016, followed by a $40-million fund announced in partnership with Telkom subsidiary Telkomsel in May this year.
Meanwhile, Mandiri Capital is also seeking to raise a fund with a target size of around $50-100 million. Like MDI Ventures, it plans to raise capital from external LPs for its latest fund. The VC has so far been investing in pre-Series A to Series A stage startups in the country.
DealStreetAsia is a financial news site based in Singapore that focuses on corporate investment activity in Southeast Asia and India. Nikkei recently announced the acquisition of a majority stake in the company.