Indonesia-focused online financial services platform Akulaku is reportedly investing IDR 500 billion (US$35.4 Million) into a local banking institution, Bank Yudha Bhakti (BYB). The investment will be completed in three stages until the end of this year, according to local media.

In the first stage, Akulaku acquired shares owned by Gozco Capital, BYB’s controlling shareholder, with a transaction value of IDR 158 billion (US$11.8 Million). This value is equivalent to 8.95 % of Gozco’s BYB shares.

Akulaku CEO William Li said that this is the first time a fintech startup is backing a traditional financial institution in Indonesia.

Akulaku had most recently raised a US$100 million series D round led by China’s Ant Financial. It started out as a virtual credit card that let users buy products and pay for them in installments, but it has diversified into a broader suite of financial services.

The investment is expected to help speed up the bank’s digital transformation. The investment will expand BYB’s business sector to new fields such as individual loans, as well as for micro, small, and medium enterprises (MSMEs). For Akulaku, collaborating with a bank can have legal benefits, as some financial services and data sources are restricted to institutions with a full banking license, not lending startups.

“There will be a combination of the technology owned by Akulaku with Bank Yudha Bakti,” the president director of the bank, Denny Novisar Mahmuradi said at a press conference. “Akulaku has collaborated with many big e-commerce platforms like Blibli and Tokopedia, so it has a wide market of online shoppers.”

According to

, Akulaku’s total funding sits at US$220 million. In DailySocial‘s most recent Indonesia Startup Report, Akulaku is poised to be one of Indonesia’s next unicorns with a current valuation of about US$500 million. Other notable investors of Akulaku are Sequoia Capital India, Qiming Venture Partners, and Blue Sky Private Equity.

Editor: Nadine Freischlad