Jakarta. Fintech company Gadai Pinjam Indonesia is gearing up for a growth spurt this year in a mission to expand the reach of financial services to unbanked small and medium enterprises.
The company, which provides pawnshop services and micro-loans through its online platform Pinjam.co.id, eyes to disburse between Rp 100 billion ($7.52 million) and Rp 200 billion this year, increasing up to 10 times its loan outstanding.
Pinjam customers can apply for loan and upload their valuables — ranging from gold, handphones to laptops and vehicles — for collateral, and obtain an estimation of their goods value on the company's website or mobile app.
The customer who has obtained the estimation can then bring the collateral to Pinjam's outlets or have the company's appraiser come to his place. If approved, the customer will have the loan transferred to his bank account within hours.
Pinjam will cooperate with state-owned post Pos Indonesia as well as some gold shops, to increase the number of outlets where their customers can pawn their goods. It plans to have more than 100 points in Jakarta by the end of this year.
"We are confident to reach the target, because we started with only one outlet last year. Now we have around 40 outlets in Jakarta," Pinjam director and co-founder Teguh B. Ariwibowo said in recent interview.
Teguh said the company aims for 50,000 loan transactions this year, a steep jump from 2,500 a year earlier. Today, Pinjam has about 30,000 registered users.
Pinjam competes at a market where many other fintech firms try to outmaneuver traditional banks. According to Bank Indonesia, the country's central bank, about 80 percent of the country's 59 million small and medium enterprise have no access to bank loans.
Teguh, who himself was once denied a loan, sees an ample room for companies like Pinjam and its rivals, including Investree, Modalku, Amartha and Koinworks, to grow.
"We are similar but not exactly the same," he said.
The company has secured a pawnshop license from the Financial Services Authority (OJK), under which it can disburse collateralized loans up to Rp 100 million.
The license means that Pinjam loans are from its own capital. Another fintechs like Investree, use peer-to-peer business model, which means they only act as middleman between individual or business lenders and borrowers.
The company has also updated decades long pawn business model run by state-owned pawnshop Pegadaian.
Last month, in a move to cater to the market segment is not yet tapped by Pegadaian, Pinjam launched an instant pawn service, in which its appraisers give the loans to customers at the customers' places.
About 70 percent of Pinjam.com customers are between 25 to 35 years old, and are already familiar with mobile internet services.