INDONESIAN startup Alami has closed an undisclosed pre-seed round led by fintech investor tryb Group, in one of the few early-stage deals for the region's Syariah fintech industry that are backed by venture capital firms based in South-east Asia.
The capital injection, which was an equity investment, is tryb's first in Alami, tryb told BT. Alami operates as a marketplace for Islamic financing, working with partners such as Syariah banks to facilitate invoice financing for small and medium enterprises.
The company’s peer-to-peer (P2P) platform recently obtained a P2P registration from the country’s Financial Services Authority and is set to soon expand its business into the Syariah-compliant P2P financing space. The fresh funds will be used for product development and market expansion.
Indonesia has the largest Muslim population in the world and nearly 90 per cent of its 260 million population are Muslim. But the country's Syariah finance sector has historically lagged other markets with large Muslim populations, said tryb.
Herston Powers, principal at tryb, said: “The Syariah fintech market is a huge and untapped market in Indonesia with significant growth prospects. Fintech adoption and rising demand from across customer segments will increase the Syariah finance share of total assets in Indonesia.”
Mr Powers added that strong and vocal government support for Syariah finance and fintech has had a positive impact on the sector.
“As long as Syariah financial products are seen as credible and competitive, there is no reason why Indonesia’s Syariah banking assets should not match or exceed those in Malaysia, which stand at over 25 per cent of total banking assets, in the coming years.”
Dima Djani, founder and CEO of Alami, said tryb’s South-east Asian fintech expertise provides strong validation of its business model and key support for its growth plans.