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Islamic Finance

Indonesian Islamic fintech Alami to complete acquisition of rural bank by Q1 2023

JAKARTA – Indonesian Islamic peer-to-peer lender PT Alami Fintek Sharia will complete its 50 billion rupiah ($3.5 million) acquisition of a rural bank within one to two years at the latest, its CEO Dima Djani told Salaam Gateway.

Alami announced in mid-March its intention to acquire PT BPRS Cempaka Al-Amin and rename it Bank Hijra.

The fintech is awaiting approval from the financial services authority (OJK) for the acquisition and renaming.

Alami is now targeting at least a four-fold increase in financing from the more than 200 billion rupiah the platform disbursed last year.

"With the acquisition, we are now optimistic that the financing for 2021 can reach 1 trillion rupiah," said Dima.

The fintech will bring the rural bank’s tech up-to-speed to increase the effectiveness, efficiency and professionalism of its services to stay competitive.

"We will help digitize it in accordance with OJK's mission to digitize rural banks. Currently, we are improving the in-house technology owned by the BPRS,” said Dima.

“In addition, we will also synergize it with our business model. In this case, channelling and joint marketing.”

The fintech partnered with rural banks BPRS Sukowati Sragen in Central Java and BPRS Harta Insan Karimah Cibitung in West Java before making an offer to acquire BPRS Cempaka Al-Amin in Jakarta.

Since its establishment in 2018, Alami has disbursed accumulated financing of 565 billion rupiah, with outstanding financing of 157 billion rupiah.

The fintech platform has also partnered with commercial Islamic banks to offer financing on its peer-to-peer platform.

Alami’s strategy now is to focus on collaborations with start-ups such as eFishery and BukaPengadaan, the pawnshop service on e-commerce giant Bukalapak, to widen its reach.

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