According to Iwan Kurniawan, Modalku’s Co-Founder& COO, this collaboration is to offer access to financing services to MSMEs for the procurement of goods and services and to help positive business flow.
He also added that the company’s vision is to provide support to MSME business so that they can continue to grow which can happen if they have smooth cash flow and are supported by good financial records.
The micro-segment in Indonesia still does not have easy access to financing. According to research conducted by Modalku on 350 MSMEs who borrowed from Modalku under the name ‘The Economic and Social Impact of MSME Financing Using Fintech P2P Lending’- 50 percent of them experienced obstacles when applying for loans to traditional financial institutions as they did not have well-organized financial reports.
With this collaboration, Modalku believes that this could be one of the solutions to the challenges faced by MSMEs and could also help them to grow their business.
According to Co-Founder and President BukuWarung Chinmay Chauhan, the partnership with Modalku was in line with the firm’s plan to expand financial services on the BukuWarung platform for MSME users.
BukuWarung’s payment features that the company is offering since September 2020 in collaboration with major Indonesian banks and other digital wallet providers complement the digital financing service with Modalku.
In 2019, BukuWarung started its application service by presenting digital financial records that were easily accessible and used by SMEs. According to the company, BukuWarung would continue to strengthen its technological innovation and is committed to assist Indonesian MSMEs in developing and managing their business efficiently, from digital bookkeeping, online storefronts to payments.
MSME users will be able to take unsecured loans up to IDR 100 million for a tenure of up to 30 days, as long as they have been in business for at least six months. The loan can be used to meet business capital to meet various business needs such as procuring business equipment, marketing costs, increasing stock of goods, or renting a business location.
Modalku offers digital funding services where potential MSMEs can get an unsecured business capital loan up to IDR 2 billion funded by platform lenders through the digital market.
The firm also operates in Thailand, Singapore, and Malaysia under the name Funding Societies. Modalku to date has disbursed business loans of Rp. 25.6 trillion to over 4.7 million MSME loan transactions.