Southeast Asia’s largest online travel company, Traveloka, plans to launch financial services in Thailand and Vietnam
Tricia Ang, DigitalCFO Asia | 1 March 2021
Traveloka, Southeast Asia’s biggest travel app, plans regional fintech expansion before 2021 listing
Southeast Asia’s largest online travel company, Traveloka, plans to launch financial services in Thailand and Vietnam as it eyes a US listing through a blank-cheque company, Traveloka’s president stated.
The company Indonesian-based unicorn company turns 9 this year,and counts Expedia and China’s JD.com among its investors. Traveloka is seeing a strong rebound in business after the COVID-19 pandemic curtailed travel demand.
Caesar Indra, the company’s president, told Reuters in an interview that Traveloka’s Vietnam business had surpassed pre COVID-19 activity, is nearly back to normal levels in Thailand, and is at half of pre COVID-19 activity in Indonesia.
“The worst has happened and now we’re well prepared for 2021. Domestic travel is driving recovery,” he said.
“The plan is to invest in fintech in a big way to allow more consumers to travel in the region,” Indra said, adding that the travel business had bounced back to profiting in late 2020.
Traveloka, which has 40 million active monthly users, is developing “buy now, pay later” services for Thailand and Vietnam markets.
“We recently formed a joint venture with one of the largest banks in Thailand to collaborate in the fintech space,” Indra said.
Traveloka, has smaller local rivals and is also in the process of talking to potential partners in Vietnam, but Indra declined to name the parties.
Traveloka’s two-year old equivalent service in Indonesia, launched after the firm found out that customers would wait until their paydays to book travel. To date, the company has already facilitated more than 6 million loans.
Last year, Traveloka launched “Paylater” credit cards with some Indonesian lenders. It also offers insurance and wealth management services.
Indra stated the business potential was tremendous in Indonesia, Southeast Asia’s largest economy, where only 6% of the population of 270 million has credit cards.
When asked whether Traveloka might buy a bank in Indonesia, like other start-ups, to expand its financial services, Indra said, “all options were on the table”.
Traveloka is also supported by Singapore sovereign wealth fund GIC and Indonesian venture firm East Ventures. It has grown its local lifestyle services in Indonesia, where the company offers restaurant vouchers and food delivery services, as well as a popular rapid COVID-19 testing.
Indra also said that the company is Indonesia’s largest restaurant review app.
Traveloka has been preparing for an upcoming listing, and is currently holding discussions with special-purpose acquisition companies, or SPACs, for a U.S. listing.
“US markets have become more appealing because there’s more and more appreciation of Southeast Asia as a flourishing region, and by listing in the US we can also provide an opportunity for US investors to become part of Southeast Asia’s growth story,” Indra said.
Many SPACs, exchange-listed shell companies that raise money through IPOs and merge with firms by enticing them with shorter listing timelines, have approached Southeast Asian startups.
Bridgetown Holdings, backed by Asian tycoon Richard Li, Provident Acquisition and Cova Acquisition are contenders for Traveloka, with a potential valuation of up to US$5 billion for the startup, a source said. The firms did not immediately respond to requests for comment. Indra declined to comment but said an Indonesian listing remained an option.