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

Startup Modalku Launches Mobile App for Individual Lenders


JULY 21, 2017

Jakarta. Mitrausaha Indonesia Group, a homegrown marketplace that provides peer-to-peer lending, introduced a new mobile application that will allow individual lenders to offer loans to small businesses using a crowdfunding scheme.

Mitrausaha, which flies the Modalku flagship, offers small and medium enterprises (SMEs) access to non-collateral loans with interest rates ranging from 12 percent to 26 percent.

It also promises a 35 percent annual return for lenders when they invest their money into a business, but in return, Modalku keeps around three to four percent of the annual return as fees.

Modalku offers individual lenders alternative investment that offers higher returns compared to commercial bank deposit products and fixed investment products like government bonds.

Modalku had launched a mobile app in January called "Modalku Dana Usaha," customized for prospective debtors looking to replenish their working capital. The app is available on Android and iOS.

"Modalku offers a win-win solution for customers, for lenders or people looking for alternative investment products and for small business owners," Modalku chief executive and co-founder Reynold Wijaya said in a statement.

The Modalku app includes a feature called "Automatic Funding," which allows lenders to give loans to SMEs that fit the lenders' preferences — from investment returns, length of the loan and the size of the loan itself.

Lenders can start investing with Rp 1 million ($75).

New individual lenders need to deposit Rp 10 million into their account before giving out loans.

"Modalku customers can earn an attractive return each month with relatively controlled risks. Our app offers better access to peer-to-peer lending for people looking for alternative investment in Indonesia," Reynold said.

Modalku's initiative has earned commendations from Indonesia's Financial Services Authority (OJK).

"We welcome the launch of Modalku's mobile application. The technology will enhance financial inclusion in the country. It will also support the development of a cashless society. The new feature will expand public access to peer-to-peer lending for SMEs in Indonesia," Hendrikus Passagi, a senior research executive at OJK, said.

Modalku offers loans from Rp 50 million to Rp 2 billion payable in three, six, 12 and 24 months. All loans are ready to be disbursed in 4 days.

The company has already disbursed more than Rp 215 billion in loans to around 400 SMEs so far.