Jakarta. Investree Radhika Jaya, a local startup providing a peer-to-peer lending marketplace, is looking to open representative offices in major Indonesian cities this year as part of a push to expand its lending by more than sixfold this year.

The company, which matches individual lenders with borrowers, expects to mediate Rp 400 billion ($30 million) in loans from lenders to borrowers this year, up from Rp 65 billion last year, Adrian A. Gunadi, Investree co-founder and chairman told the Jakarta Globe on Thursday (09/03).

"We're going to open an office in Semarang hopefully by the end of this month, pending on approval from the OJK [Financial Services Authority]. Other major cities will follow soon," Adrian said.

While the company's online platform technically allows individuals from every region in Indonesia to lend or borrow money, the company still prefers to pick them from areas where the company already has a representative office. "We like to have people on the ground to feel the business vibes," Adrian said.

Aida Sutanto, Investree co-founder and chairwoman, said local presence is crucial for Investree as the company still relies on manual verification to select borrowers.So far, the company's prudent approach seems to be working. None of its borrowers has failed to pay back his or her debt.

Investree facilitates only two kind of loans to debtors who due to their lack of collateral are unable to secure loans from conventional banks.

One is a loan whose terms are custom fit for employees, who will pay it back using automatic deduction from their salary.

The other is for small and medium businesses, which supply listed companies, multinational firms, state-owned enterprises or government offices. This loan is given against these SMEs' invoices to their clients, reducing risk revenue mismatch that could hamper the debt payment. "These way we do not directly compete with banks. We complement them," he said.

As of Friday, Investree has processed Rp 86.7 billion in loans for 395 borrowers, most of them SMEs.

That is still a small number compared to the Rp 722 trillion that Indonesian lenders disbursed to small and medium businesses last year.

Bank Indonesia, the country's central bank, estimates only a fifth of the country's 59 million SMEs have access to bank loans, providing ample room for companies like Investree and its rivals, including Modalku, Amartha and Koinworks, to grow.

The market, however, would not stay lush for long because rivals from mature peer-to-peer lending markets like the US and China are likely to set their eyes on Indonesia in order to push growth.

"I am convinced that as soon as next year we'll start seeing foreign companies coming in," Adrian said. "We have to be ready, we need to grow fast."