Peer-to-peer financier Amartha Mikro Fintek has identified Sumatera as a growth driver and has partnered with a regional bank to enhance its presence in Indonesia’s largest island.
Amartha, which focuses on empowering women micro entrepreneurs through inclusive financial services including Islamic facilities, has collaborated with North Sumatera development bank, Bank Sumut, to develop women-owned MSMEs in the region. Bank Sumut will channel capital through the digital microfinance marketplace.
Amartha is looking to expand to several provinces of Sumatera including Bengkulu, Riau and Jambi, with a view of disbursing IDR3 trillion (US$200.23 million) in the region by the end of 2022 by targeting the trade sector, handicraft industry and the agricultural sector.
This follows phenomenal growth from the region. In the first six months of this year, Amartha disbursed IDR706 billion (US$46.96 million), approximately double from the IDR325 billion (US$21.62 million) it disbursed in the corresponding period in 2021. Capital distribution in the north of Sumatera, in particular, almost tripled year-on-year with asset quality improving as repayment rates hitting 100% for the second consecutive year. For the whole of Sumatera, its non-performing loan rate stood below 0.5%.
This capital distribution growth is on the back of a surge in the number of women microentrepreneur partners Amartha has been able to onboard. From the north of Sumatera, the number of partners nearly quadrupled from about 20,000 in 2021 to over 70,000 spread across at least 2,700 villages currently, thanks to Amartha’s 400 field workers. The number of partners for Sumatera as a whole reached over 300,000.