Better internet and smartphone connectivity is needed to boost e-commerce development throughout Indonesia
Cash payments preferred due to fear of fraud relating to bank transfers and credit cards.
E-commerce sites offering secure and reliable online payment solutions will be able to attract and retain a huge number of new online consumers.
Kudo offers a more accessible and reliable online payment system to appeal to the masses across Indonesia. Its trusted local agents are certified by Kudo to collect cash from the customers and make e-payments on their behalf, in lieu of bank transfers or credit card payments by the customers.
The agents are required to open Kudo accounts first by depositing funds with Kudo in advance. The agents will then receive the cash payments from the customers who wish to purchase goods and services online. The Kudo mobile app is then used to make the digital payments from the agents’ Kudo accounts. Commissions are later credited into each agent’s Kudo account based on the transactions handled by the agent.
Although tablets equipped with the Kudo app were initially given to the agents, the company has now released an Android app and a web app that enable anyone with a smartphone or a personal computer (PC) to become an authorised Kudo agent. This will help to boost Kudo’s 400,000-strong agent network, with a target of 1 million set for 2018.
In addition, Kudo also hosts an e-commerce platform for its merchants to advertise their products and services to potential customers. Notably, other e-tailers such as Bukalapak, Lazada and elevenia are also using Kudo to attract new customers who may prefer to make payments through their Kudo agents.
Kudo also operates its own store Toko Kudo, or Kudo Shop. Besides online shopping, customers can also top up their SIM card accounts, pay bills and insurance premiums, or even buy flight tickets online. Gift vouchers for popular brands, including online games, are also available on the website.
Therefore, it came as no surprise that Southeast Asia’s up and coming technology company Grab has offered millions of dollars to acquire Kudo’s O2O network in Indonesia. Grab has pledged to invest US$700 million to develop various business operations in Indonesia, with US$100 million earmarked for local startups involved in developing innovative financial services.
Research showed that internet penetration in areas outside the cities was estimated to be 20% in 2014. A significant portion of local consumers also do not have credit cards or other bank accounts to enable them to shop online. Many are also unfamiliar with the process of online shopping and e-payments, explained Kudo’s CEO Albert Lucius. Kudo and GrabPay will be merged to tap into this huge e-commerce market, ranging from on-demand services, online shopping and financial services.
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December, rolled out Kudobox 1 kiosks in shopping malls and public locations in Jakarta.
November, Kudo raised seed funding from East Ventures.
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January, Kudo began employing agents to introduce Kudo to potential customers.
April, undisclosed funding from SPH Media Fund
May, secured seven-digit Series A funding led by GREE Ventures and East Ventures, joined by 500 Startups and IMJ Investment Partners. The funds were needed to expand Kudo’s network of local agents who had to be supplied with tablets to access the mobile app.
June, further funding received from EMTEK, just 30 days after closing the Series A funding round. Again, the funds were needed to finance Kudo’s decision to give each new agent a tablet to enable them to access the Kudo app payment system.
December, undisclosed funding from SPH Media Fund.
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March, a Kudo mobile app was launched through Google Play Store.
May, Kudo released a web version of its app, allowing those with a PC or laptop to become Kudo agents as well. Anyone with a computer or an Android device could apply to become an agent by signing up and providing a proof of identity.
September, Kudo announced an eight-digit funding round led by EMTEK.
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April, Singapore-based ride hailing tech company, Grab announced the acquisition of Kudo.
Currently has over 400,000 agents serving 1.6 million customers across Indonesia. Local agents are vital to Kudo’s e-payments infrastructure to connect vendors to consumers across the archipelago.
Kudo was recently acquired by Grab, well-known for its GrabTaxi app, a transport booking platform that covers 28 cities across six countries in Southeast Asia. The Singapore-based technology company is now rapidly diversifying into other e-commerce sectors including consumer and financial products.
Recruit 1 million agents across Indonesia to use the e-commerce platform by 2018.
Complete Kudo’s integration with Grab’s payment ecosystem GrabPay, to expand into other e-commerce businesses besides transportation.