FinAccel, the parent company of Indonesia’s buy-now, pay-later (BNPL) platform Kredivo, is aiming for a US listing in first quarter of 2022 via a merger with a blank-cheque company backed by Chicago-based Victory Park Capital (VPC), both firms said on Tuesday.
VPC Impact Acquisition Holdings II, the special purpose acquisition company (SPAC) sponsored by VPC, has raised $256m in March this year, seeking a high-growth fintech company beyond US borders.
Aside from the money already raised by VPC Impact, the deal will also include $120m in private investment in public equity (PIPE) led by Marshall Wace, Corbin Capital, SV Investment, Maso Capital and sponsor VPC, with existing investors Naver, Square Peg Capital, and Jungle Ventures committing additional $55m investment. In total, the SPAC deal is expected to generate over $430m in cash proceeds.
Indonesia BNPL leader
The Singapore-headquartered FinAccel is the latest start-up from South-East Asia seeking fresh funds via US SPAC, following in the aspirations of ride-hailing Grab Holdings and online real estate classifieds PropertyGuru.
Established in 2015, FinAccel operates under the brand ‘Kredivo’, providing BNPL service in eight of Indonesia’s top-10 e-commerce firms. With nearly four million customers, it claims to be the market leader in the BNPL segment with at least 50% market share across major e-commerce platforms.
“Unlike Western markets where credit is readily accessible, traditional banks in South-East Asia have historically provided little consumer credit in our markets, which creates a large opportunity for Kredivo to tap into other credit needs, such as personal loans, and fulfil our vision of providing fast, affordable, and easily accessible credit to tens of millions of customers in the region,” said FinAccel co-founder and CEO, Akshay Garg.
Thai, Vietnam expansion
“Considering that 66% of South-East Asia’s population is unbanked or under-banked, we also see a very attractive opportunity to serve these customers with other financial services, outside of credit,” said Garg.
Priding itself with “as little as two minutes” approval process, FinAccel is receiving a boon from the rising e-commerce market in Indonesia which grows over 20% a year. The BNPL firm plans to enter Vietnam and Thailand markets in the future.
“Since our initial investment in 2020, we continue to be impressed by Kredivo’s rapid growth and strong credit metrics and unit economics,” said Gordon Watson, a partner at VPC and co-CEO at VPC Impact. “The company has created an impressive platform that enables it to expand into new markets.”