Bank Jago’s life-centric approach suits new style of financial management

The tech-based bank has assisted more than 10 million Indonesians through seamless integration into the digital ecosystem since 2021.

According to Director of Bank Jago Peterjan van Nieuwenhuizen, there are two unique propositions that  differentiate Bank Jago from the other digital banks.

Firstly, Jago is not just about banking; it’s about life centricity. Jago’s focus is not on basic banking products, but on a solution that helps people get closer to their dreams and aspirations.

“Most digital banks treat digital purely as a new channel, but at Jago, we see it as an opportunity to invent a new financial services value proposition centered around you and the things that matter in your life,” van Nieuwenhuizen told Asian Banking & Finance in this exclusive interview.

Secondly, Jago is everywhere you are online, settling you comfortably into Indonesia’s digital ecosystem.

“We know that people don’t necessarily want to start their banking app very often, while they use ride-hailing, e-commerce, etc., apps multiple times a day. We are just as comfortable with people accessing Jago through the UI of our partners as we are with them using our own app (Jago App),” van Nieuwenhuizen said.

Through this seamless integration, banking services become as easy as using your favorite apps. Whether through their own platform or via partners, Jago ensures banking services fits effortlessly into one’s digital lifestyle.

“That lets you seamlessly save, spend, and borrow the way you want, together with your loved ones. Customers can access it through Jago’s own app or through our more than 20 Jago partners including GoPay, Bibit, or Stockbit apps,” he added.

This reflects the bank’s vision to offer solutions that help Indonesians get one step closer to their dreams, enabling their customers to manage their money the way they want.

Closer to customer needs

Bank Jago always presents features that revolve around the lives of their users. One of their flagship features is “Shared Pocket,” which was created by listening to the concerns experienced by customers.

van Nieuwenhuizen said Shared Pocket was launched for customers who needed virtual pockets like one for daily spending, another of children’s school fees, one for long-term savings, and a separate one for leisure activities.

Moreover, the pocket is also intended for a variety of communal settings where some things are done in a family setting, some with work colleagues, some with a group of old friends, some in arisan, and some are done individually.

“Jago connects with both these aspects of people’s lives through shared pockets. Our users can compartmentalise their money in multiple pockets each with their own name and avatar. One pocket for each type of spending or each savings goal they have. Then they can choose for each of these pockets whom they may want to give access. Their groceries pocket they share perhaps with close family and a household helper; an arisan pocket with all the members of the arisan,” van Nieuwenhuizen told Asian Banking & Finance.

Strategic partnerships

Jago offers its solutions both directly to customers and also through partners. The main direct channels are the Jago mobile app aimed at individuals and micro-businesses and the Jago cash management app aimed at larger businesses.

Users can also access Jago’s products and services through a large range of partners. From lending partners such as BFI Finance, Atome, Kredit Pintar, Home Credit, to investment partners such as Bibit where customers benefit when they sell mutual funds units, for an increasing number of funds, they have access to the money resulting from divestment instantly.

Jago’s most famous integration is with GoPay (GoTo). The partnership between GoTo and Jago goes back a long way. “It has brought real benefits to our joint customers and to both partners. This is due to the clear alignment at the leadership level, the strong collaboration between the mutual teams, and the resulting tight integration at a practical (product) level,” said van Nieuwenhuizen.

The ability for users to link their Jago pockets into GoPay for easy payment for rides, food delivery, Tokopedia orders, and so on, has contributed significantly to the growth of Jago’s customer base. Several million people have registered for this GoPay Jago collaboration.'“Similarly, we believe the funding provided by Jago for GoPay Later and GoPay Pinjam has helped GoTo Finance to grow their loan portfolio,” he said.

GoPay Tabungan, launched a few months ago, should also be a game-changer because it gives people a convenient daily transaction account combining the simplicity of electronic money with the benefits of a bank through a simple, quick upgrade.

GoPay Tabungan allows people to start experiencing the power of Jago in a familiar environment, in an app such as Gojek or GoPay or e-commerce, Tokopedia, which they use regularly. On the other hand, customers now get interest, full bank-level security including deposit insurance, and none of the limits of electronic money.

“We are excited about how this is going to help make life easier for our users, and deliver results for both GoTo and Jago at the same time. We are mutually committed to keep adding exciting features to GoPay Tabungan by Jago, such as the recently launched Simpanan account capability, with several innovations lined up for the rest of this year,” van Nieuwenhuizen said.

Relevant to market

van Nieuwenhuizen said Jago focuses on the middle and mass market, both shariah and non-shariah, and both individuals and businesses. He quoted research from McKinsey & Co stating that the so-called consuming classes in Indonesia have been growing rapidly and are projected to keep growing for many years to come, and expects around 70 million people to enter the consuming class between 2020 and 2030.

“We have also seen digital adoption go up very rapidly, making it feasible to serve a large proportion of these segments digitally,” said the bank executive.

Furthermore, Jago’s life-centric approach to financial services is particularly relevant in the middle and mass market, who have typically only had access to basic products and services, without the support of relationship managers and personal advisors available to the more affluent.

Bank Jago has come a long way and helped over 10 million Indonesians get one step closer to their dreams, van Nieuwenhuizen said, “by making it easier to build their wealth through our partners, Bibit and Stockbit; by extending through our lending partners.”

Jago initiated Kumpul Jagoan, a collaborative forum between Jago and various Indonesian communities, to educate people on financial management. Then, it partnered with universities to establish the Jago Digital Academy, aiming to enhance digital skills across multiple disciplines.

As a result, Jago experienced substantial growth, reaching over 10 million KYC-ed users and accumulating a balance sheet exceeding USD$1 billion. “And it did that without burning capital, by reaching profitability within 6-9 months from launch,” van Nieuwenhuizen said.

He said Bank Jago was able to do this by setting up their team with a mix of strong digital and deep financial services skills and experience so they are able not only to create an exciting digital product but also to manage the risks, liquidity, and regulatory angles that are critical in financial services.

This capability is also important to respond to current banking trends, namely, a shift back to fundamentals: profitability, more attention to risk management, and liquidity management. “The days of burning money to chase growth at any cost are over, at least for now,”  he said.

He added that for Jago, digital is not just a channel but an opportunity to offer a new style of financial service.

“We aim to launch several new features this year, both in the Jago app and in collaboration with our partners. Some of those features will go into new product areas, beyond payments and transfers and savings and some of those features will begin to serve customer segments that Jago has not addressed so far. Stay tuned!” he said.