The people leading Indonesian fintech unicorn Akulaku

In The Top Up this week, we look at the leadership team of Akulaku and the newly announced venture between GXBank and Zurich Malaysia. [Read from your browser]( The Top Up Welcome to The Top Up! Delivered every fortnight via email and through the Tech in Asia website, this free newsletter breaks down the biggest stories and trends in fintech. If you’re not a subscriber, get access by [registering here]( IN FOCUS In today's newsletter, we look at: - The [decision-makers]( at Indonesia-based fintech firm Akulaku - GXBank’s foray into microinsurance - [The players in Singapore’s crowded fintech space]( --------------------------------------------------------------- Hello {NAME} I’m probably in the minority for never having tapped on a buy now, pay later (BNPL) service, although I did choose to pay in installments for my iPhone and iPad. Despite the headwinds in recent years, it is possible to run a profitable BNPL business - Atome Financial’s [operating income rose]( to US$170 million in 2023. While its largest user base is in Indonesia, the company expressed excitement about Malaysia and the Philippines, where it said there is “much less competition.” One of Atome’s biggest competitors in Indonesia is Ant Group-backed Akulaku, though it has faced its fair share of challenges. In this week’s Big Story, my colleague Budi maps out the decision-makers at Akulaku and notes that its BNPL offerings were found by Indonesia’s financial services authority (OJK) to have violated supervisory obligations. The fintech unicorn, which was seeking a US listing in 2022 via a [SPAC]( merger that would value the combined entity at US$2 billion, was prohibited from offering BNPL services from October 2023. But these restrictions were lifted in March this year. Meanwhile, the share price of Bank Neo Commerce (BNC) - Akulaku’s affiliated digital bank, in which it owns a 27% stake - is down 90% from its peak in late 2021. The responsibility of turning things around now falls on Eri Budiono, who was appointed CEO of BNC last week. On the topic of digital banks, in this week’s Hot Take, we take a closer look at the Malaysia-based digibank GXBank - a subsidiary of GXS Bank in Singapore - which announced a partnership with Zurich Malaysia. Together, both firms aim to provide microinsurance products to underserved Malaysians. Why launch a microinsurane product in Malaysia? Read on to find out. -- Simon  --------------------------------------------------------------- THE BIG STORY [Org Chart: The execs stewarding Akulaku’s growth]( In April, the fintech firm appointed a new CEO for Bank Neo Commerce, its digital bank, whose share price has fallen around 90% since its 2021 peak.  --------------------------------------------------------------- THE HOT TAKE What will it take for GXBank and Zurich Malaysia’s partnership to succeed? Here’s what happened: - GXBank, the Malaysia-based subsidiary of GXS Bank, announced a [10-year exclusive bancassurance partnership]( with Zurich Malaysia. - Their first product, which aims to protect individuals from unauthorized transactions resulting from cybercrime, is slated to be launched in the third quarter of this year. - Both firms will co-create microprotection products for underserved Malaysians. Here’s our take: Launched in November 2023, GXBank is younger than GXS Bank, its Singapore parent born as a joint venture between Grab and Singtel. Yet, the Malaysian digibank is also the first of the two to launch an insurance product. In fact, GXBank has gone a step further by announcing a decade-long exclusive partnership with the Malaysian arm of Swiss giant Zurich Insurance Group. Protecting individuals from unauthorized transactions resulting from cybercrime, as well as those initiated by electronic scam messages, does seem to make sense. According to recent reports, online fraud cases in Malaysia [doubled]( between 2019 and 2023, and losses [exceeded RM1.3 billion (US$270 million)]( last year. However, neither GXBank nor Zurich Malaysia has provided any further details, such as the pricing, coverage, and duration ahead of the product’s launch. Similarly, while both parties said they would jointly develop digital insurance products that are “simple, user-friendly, and affordable,” they were mum on what types of insurance products these would be. Microinsurance products are available in bite-sized portions and generally don’t require medical tests and other documentation. They are often pitched as a more affordable form of insurance coverage, and the sum insured is also [lower than in traditional policies](. These products generally cover needs that traditional insurers have overlooked. For example, last year, Singapore insurtech firm Igloo [launched several insurance plans]( one of which protects customers against food poisoning while another provides coverage for mobile phones. As microinsurance products are [low-margin]( success will come to companies that sell a large number of such policies. For example, Igloo has facilitated [over 500 million policies]( since its inception, but it’s still not profitable, although it is aiming to go in the black this year. The question GXBank faces is whether the underserved segment of Malaysia’s nearly [35 million]( population is large enough to support the volumes needed to build a sustainable business. Apart from affordability, the other factor contributing to the number of uninsured people is a lack of understanding of the need for insurance protection. Junior Cho, country CEO and head of Zurich Malaysia, said the long-term nature of the partnership will enable the insurer to be “flexible and agile in how [it] can co-create relevant affordable insurance products.” He didn’t elaborate on how the need to enhance awareness is linked to the long-term nature of the partnership, or how flexibility helps. Still, despite these issues, GXBank is at the tip of the spear when it comes to how Grab’s family of digital banks in the region can integrate insurance in their suite of products. At some point, lessons from this initiative may come in useful when deciding how to approach providing insurance to users of GXS Bank in Singapore, and perhaps more importantly, to those of Indonesia-based [Superbank]( in which Grab and Singtel have a [32.5%]( stake.  --------------------------------------------------------------- NEWS YOU SHOULD KNOW Also check out Tech in Asia’s coverage of the fintech scene [here](. 1️⃣ [Paytm shifts management, COO steps down]( According to the company, the new appointments - including a new CEO for Paytm Money - align with its initiatives for expansion, innovation, and regulatory compliance. 2️⃣ [SG fintech group hands out accreditations to 4 players under new code]( TrustMark accreditations were given to four BNPL firms: Abnk, Atome, Grab, and SeaMoney. 3️⃣ [Grab-backed Superbank introduces auto-savings product in Indonesia]( Called Celangan, the feature offers an interest rate of 10% per annum at launch. 4️⃣ [Airwallex expands payment services to the US]( The move comes a year after the payments firm launched in Canada, China, and Israel and after it acquired a fintech firm in Mexico.  --------------------------------------------------------------- FYI [The players jostling in Singapore’s crowded fintech space (update)]( Funding into fintech startups in the city-state went down by 35% to US$1.49 billion last year, according to Tech in Asia data. --------------------------------------------------------------- EVENTS HAPPENING You can also check out a curated list of trending tech events [over here]( and Tech in Asia’s signature events [here](. [Saigon Summit 2024 : Charting Vietnam’s Tech Future on May 30]( Saigon Summit will host discussions on Vietnam’s trending verticals, such as ecommerce, fintech, and electric vehicles, with VNG, VNLife, Razer will share their stories and insights. Join us as we discover the undeniable potential of Southeast Asia’s next tech hotspot. [Grab your tickets]( before they’re gone! [Tech in Asia Conference Kuala Lumpur 2024 : Malaysia on The Rise on July 24-25]( Fintech and travel tech enthusiasts, this one's for you! Join us at the Tech in Asia Conference in KL to hear from Tonik Bank, CrescentRating & HalalTrip as they share their expertise and insights. Don't miss out - [purchase your tickets]( today! [Product Development Conference (Jakarta, 25-26 June 2024)]( In this edition of Tech in Asia’s flagship conference for product talent, get access to keynote presentations, interactive Q&As, and networking opportunities that help you to build, launch, and scale world-class products. Early-bird tickets are gone, but fear not—you can now grab first-release tickets at 50% off! Better yet, bring 2 friends and secure an extra 20% off. [Secure your spot now](. [Tech in Asia’s Founders Meetup in Vietnam on May 30]( Founders Meetup is returning to Vietnam as part of the official closing party of Saigon Summit! Unwind and connect with founders, startup leaders, and investors from across the region at this premier networking mixer. Early bird tickets are fully redeemed – [get yours at US$12 now]( ---------------------------------------------------------------  That’s it for this edition - we hope you liked it! Do also check out previous issues of the newsletter [here](. Not your cup of tea? You can unsubscribe from this newsletter by going to your “edit profile” page and choosing that option in our preferences center. In the meantime, if you have any feedback or ideas, feel free to get in touch with Terence, our editor-in-chief, at terence@techinasia.com. See you soon! P.S. Don't miss out on the biggest tech news and analysis. Add newsletter@techinasia.com to your address book, contacts, or safe sender list. Or simply move us into your inbox. Too many emails? Switch to a different frequency or get new content through our [preference center]( or [unsubscribe](. You can also break our hearts and remove yourself from all Tech in Asia emails over [here](  Copyright © 2024 Tech in Asia, All rights reserved. 63 Robinson Road, Singapore 068894