California-based financial services provider Visa has partnered with Indonesian ride-hailing firm Go-jek to help it expand its digital payment systems for the Southeast Asian markets. The partnership is expected to allow Go-jek to offer customers additional cashless payment options on its platform.
According to a joint statement released by both companies, Visa is also buying a stake in Go-jek. The investment amount or the percentage of the stake Visa purchased was not disclosed. This isn't the first tech startup Visa has invested in as the company is reportedly also an investor in the ride-hailing service company Grab.
Go-jek currently has its own digital wallet service called Go-Pay, which it uses for a variety of services on its platform. The services include ride-hailing, bills payment, and loading mobile phone credits. Through its service, users can also send and receive money from other users. They can also deposit and withdraw money to and from their connected bank accounts using Go-Pay.
Go-Pay's chief executive, Aldi Haryopratomo, announced that the company's partnership with Visa should allow them to provide users with more convenient and seamless transactions across a wide range of socio-economic groups.
The executive further elaborated that it has already provided access to digital payments in Indonesia and the partnership should result in a further expansion of the company's services to consumers across Southeast Asia.
The recent partnership between Go-jek and Visa comes just months after Visa's rival MasterCard announced its partnership with rival ride-hailing service Grab.
MasterCard and Grab's partnership resulted in the launch of new prepaid cards that users could use in various countries across Asia. Users can use the card to avail of different products and services online and at any merchant that access MasterCard as payment.
The new prepaid cards are expected to go into circulation by the second half of the year.
Digital payment leaders, such as Visa and MasterCard, and tech startups, such as Grab and Go-jek, have started to capitalize on the growing market for digital payments for services in Southeast Asia.
The region, which consists of more than 600 million people, are rapidly adapting to the new technologies, especially for those who not have accounts with traditional banks or those that do not have any experience with financial institutions.
Digital wallets have become the new standard for these people, who are now finding it more convenient to go cashless when availing certain services and buying certain products.
There is also the added benefit that digital financial records are now slowly being recognized by some banks as valid metrics for releasing loans.