Hendrikus Passagi, OJK's senior research executive, left, and Reynold Wijaya, co-founder and chief executive of Modalku, right. (Photo courtesy of Modalku)

Modalku Gets Audited to Gain Public Trust


SEPTEMBER 06, 2017

[Updated at 01:47 p.m on Sept 8, 2017 to clarify Modalku's claim in the 6th paragraph]

Jakarta. Mitrausaha Indonesia Group, also known as Modalku, a homegrown marketplace that provides peer-to-peer lending, received an "unqualified opinion" which is the best possible audit outcome  from public accounting firm Purwantono, Sungkoro & Surja, hoping it will help the company gain the public's trust.

Purwantono, Sungkoro & Surja, a member of Ernst & Young, granted the company an "unqualified opinion" ranking after reviewing the company's financial statements, income reports and other relevant comprehensive income statement, equity changes, cash flow datat and other information for the year ending Dec. 31. A ranking of this stature means the statements are deemed sound.

"Modalku team has reached many things together but we always want to give more," Reynold Wijaya, Modalku chief executive and co-founder, said in a statement on Wednesday (06/09).

"Winning the public's trust and the government's [trust] is our priority," he said.

Modalku offers small and medium enterprises access to short-term non-collateral loans with annual interest rates ranging from 12 percent to 26 percent with a tenure of up to 24 months. This is in comparison to Bank Mandiri  the country's biggest bank by assets — which offers an annual interest rate at 18.75 percent for micro loans for small and medium-sized enterprises.

As a marketplace that provides peer-to-peer lending, Modalku also claims lenders could get returns up to 35 percent annually due to compounding effect, if the lenders reinvested the monthly payments from borrowers.

Modalku has channeled Rp 600 billion ($45 million) for 880 loans, making it one of the biggest peer-to-peer lending platforms in both Indonesia and Southeast Asia. It also has been officially registered on Indonesia's Financial Services Authority (OJK) and has a custodian agreement with Bank Sinarmas, making Modalku the first peer-to-peer lending platform whose funds are guarded by a custodian.

"When customers' funds are unprotected, funds can easily be misused just like in Ponzi scheme cases," Reynold said.