Gojek has joined rival Grab in backing Indonesian state-backed e-wallet company in its Series B funding round.
Gojek’s joining as a strategic shareholder will provide LinkAja access to the Gojek ecosystem to support LinkAja’s mission in accelerating financial inclusion in Indonesia, LinkAja CEO Haryati Lawidjaja said in a statement.
As part of the deal, the ride-hailing giant will add LinkAja as a payment option on its app. The strategic investment builds on Gojek’s ongoing collaboration with the e-wallet, which includes payment for transportation and ticket reservation services.
Formed from a consortium of state-owned enterprises, LinkAja operates an e-wallet and merchant services business focusing on the middle class, and micro, small, and medium-sized enterprise (MSME) segments in Indonesia.
About 80 percent of its users are from tier 2 and 3 cities, according to LinkAja.
According to GlobalData, rising Internet penetration, increasing digitalization and the proliferation of websites have been driving the growth of e-wallets in Indonesia, which further rose during the Covid-19 pandemic as customers have turned to alternative payment tools.
Investments in state-backed entities can be a strategic move to maintain a healthy relationship with the government machinery. Though both Grab and Gojek managed to garner investment positions in LinkAja, Gojek seems to get some home advantage, Aurojyoti Bose, lead analyst at GlobalData, said about the deal.
Grab, which competes with Gojek for dominance in the digital payments space in Southeast Asia, announced in November 2020 that it had invested $100 million in LinkAja, with participation from Telkomsel, BRI Ventura Investama and Mandiri Capital.