How FinAccel’s $2.5B SPAC Points to Southeast Asia’s Golden Age

Cathay Innovation
Cathay Innovation
Published in
6 min readAug 3, 2021


By: Nicolas du Cray, Rajive Keshup, Alexandre Lazarow, Lorraine Ge, Romain Dufourcq

In 2019, FinAccel — an AI-enabled consumer credit solution — raised what was then the largest fintech funding round in Southeast Asia. At Cathay Innovation, this marked our first investment in the region out of our freshly minted Singapore office.

Today, FinAccel is the largest and fastest growing “buy now, pay later” (BNPL) platform in Indonesia and just announced its plans to go public through a merger with a SPAC sponsored by Chicago-based Victory Park Capital, raising $120M and valuing the company at $2.5B.

Founded in 2015, FinAccel now provides over four million customers among Indonesia’s rapidly growing middle class with instant credit. Led by Co-founder and CEO Akshay Garg, the company aims to make financial services fast, affordable and accessible for the underbanked population of Southeast Asia. Its flagship product Kredivo offers two types of loans: zero-interest 30-day BNPL financing at the merchant terminal or ecommerce checkout, and three-, six-, and 12-month installment loans at the most competitive rates in the country.

Despite the impacts of COVID-19, the company has managed to scale resiliently (doubling users in the last 10 months and annual revenue in the last seven) while managing risk, with its non-performing loan ratio in the low single-digits. The company’s total warehouse financing facility also recently grew to $200M, supported by VPC. The upcoming public listing will not only enable FinAccel’s continued growth, but allow the company to expand into additional markets such as Vietnam and Thailand and enter new business lines.

As a global venture capital firm, we’ve tracked how the fintech revolution has traversed and transformed across continents with key players in our portfolio from Chime (the leading digital bank in the US) to Alma (bringing the BNPL movement to Europe) and Kueski (pioneering inclusive online lending in Mexico).

Similar to what we saw in China, Southeast Asia has experienced a sharp increase in internet and mobile penetration, a growing middle class and improving infrastructure — creating the ideal circumstances for a digital and startup boom. With less legacy from “traditional” services — a new generation of digital players are now “leapfrogging” with the latest technologies to reinvent industries and scale new business models that can surpass incumbents in developed regions.

That’s why we’re backing innovators throughout the region such as Igloo and Coherent, who are transforming the insurance industry to be digital-first, data-driven and more accessible to Southeast Asian populations. And with FinAccel’s quick rise to a dominant fintech of the region — now entering the public markets — this is not only good news for promoting financial inclusion, it is the latest, strong indicator that Southeast Asia is entering its golden age driven by innovation and technology.

Southeast Asia: The Golden Age of Tech, Investment and Beyond

With its SPAC, FinAccel is joining a slew of Southeast Asian tech unicorns set to go public this year, including Grab, GoTo, Traveloka and Bukalapak. In fact, 2021 is expected to be a blockbuster year for investors, with listings delivering healthy returns and attractive exits. This speaks largely to the maturation of the startup ecosystem, with several companies planning for a dual listing — one in the US and another within the region.

Yet, Southeast Asia still has room for tremendous growth and is well on track to catch up with the world’s economic powerhouses — becoming the fourth largest economic bloc in the next decade.

As a result, investors remain bullish. In the last 10 years, an estimated $52B of venture capital investments were poured into the region. And while 2020 saw investments take a hit globally, Southeast Asia contracted narrowly compared to other parts of the world. The first quarter of 2021 also broke all fundraising records, with regional startups raising $6B in the first quarter alone. The influx of capital is rising in conjunction with Southeast Asia’s status as a viable emerging market.

While Chinese investors have been actively investing in Southeast Asia since the early 2010s, the region has been the focus of investment from Western investors looking for higher growth opportunities and to replicate models that worked in their home markets, abroad. As such, a range of global firms are now present in Southeast Asia, either actively exploring deals remotely or aggressively recruiting local talent. This encompasses firms across all stages — including internationally renowned names like Tiger Global, Point72 Ventures, Andreessen Horowitz, DST Global, Light Speed Venture Partners, and Social Capital Hedosophia.

This is good news for all stakeholders. In addition to improving access to capital for entrepreneurs, investors benefit from a well-developed venture landscape with more local expertise — connected to firms with global reach — translating to greater knowledge-sharing, collaboration and deal flow across the region.

The robust startup scene has also been fueled by eager and hungry entrepreneurs that have enabled the Southeast Asia to become an innovation hotbed. Several of the hottest startups in the region have been founded by what is known as the “Grab/Gojek/Lazada Mafia” (similar to the PayPal Mafia), whom have spread across various verticals or have started companies with others within the alumni network. Notable names include BukuWarung, Endowus and Aspire.

But perhaps what is most exciting and unique about Southeast Asia is that much of the region is still in its development stages, and there is massive potential and numerous opportunities for startups to create true value by solving structural problems and offering real-world solutions.

Enter FinAccel: Accelerating Financial Inclusion in Southeast Asia

With the global “underbanked” population at over 4B people, formal financial services are failing to meet the needs of many. But today, we’re seeing new channels emerge through tech platforms (e.g., ecommerce) at the point of sale or using smartphones as a source of data in the absence of a credit score — lowering the barrier of entry. These models have already proved successful by the likes of global companies like Affirm (who saw a $1.2B IPO earlier this year) in the US and Nubank in Brazil (valued at $30B).

Indonesia is one of the most valuable markets in Southeast Asia’s digital finance sector, yet half the country, or 130M people, do not use a traditional bank account to access financial services such as loans and credit cards. At the same time, Southeast Asia is going digital fast — internet usage is multiplying with 40M new users this year alone (400M YTD) while the ecommerce market is expected to grow from $38B in 2019 to $172B in 2025. With the region’s large underbanked digital savvy population, this leaves a massive opportunity for fintech’s to fill the financial services void.

This is precisely what makes FinAccel so powerful. By providing users with instant point-of-sale financing and personal loans, the company is recreating traditional payments and credit networks, but leapfrogging in markets where it doesn’t exist. The company also removes friction from checkout and works with hundreds of partners, including eight out of the top ten leading ecommerce players in the region, helping merchants more than double the average basket size with up to three times more frequent transactions.

FinAccel combines three separate businesses: connections to the banks, credit scoring infrastructure and a real-time transaction engine — leveraging deep data analytics to help consumers build credit scores. This is especially needed in Southeast Asia, where credit card penetration remains low and demand high. Fintech solutions have thus been a crucial financial equalizer, promoting financial inclusion by overcoming geographical constraints and giving consumers more market options.

A Parting Thought

There is a profound (yet often unspoken) connection between what’s good for business and what’s good for society. For instance, the lack of traditional forms of financing in Indonesia spurred fintech innovation that is providing access to credit or new banking options, particularly to those at the bottom of the pyramid, that stand to achieve terrific adoption.

At Cathay Innovation, supporting entrepreneurs to achieve positive social change is core to our ethos. We are proud to have been part of Akshay and his team’s journey and to have witnessed the evolution of FinAccel in accelerating financial inclusion in Indonesia. And as Southeast Asia continues to mature, entering its golden age, we’re looking forward to continue supporting mission-driven entrepreneurs across the region.



Cathay Innovation
Cathay Innovation

A global venture capital platform investing in startups positively impacting the world through technology. #VentureCapital #Global #Startups #Digital #Impact