Indonesia has a population of about 270 million, and most of these other people do not have enough banking services or are underserved economically. Companies in the fast-growing economy still do not have access to fashionable monetary services, such as those we place in many evolved Western economies.
Digital monetary revenues are expected to grow at a compound annual expansion rate (CAGR) of 34% and are expected to reach $8.6 billion by 2025. A report through McKinsey estimated that between 2014 and 2017, penetration of virtual banking in the country increased. up to 1.6x.
Indonesia’s banknote sector has expanded in recent years. The country’s invoice sector is governed by several established service providers supported by giant Internet corporations operating in Asia.
The growing invoice industry now presents new opportunities for fintech corporations in spaces such as payment security, visitor authentication, fraud detection, fraud prevention, customer knowledge coverage and foreign regulatory compliance for cash transfers, the report notes.
In addition, there are a number of other opportunities in the foreign letters sector in Indonesia. These are constantly being advanced so that invoices can be made with a lower charge and improve their efficiency. Indonesia now ranks first in terms of remittance receipt. However, prices related to the budget transfer to the country remain too high (more than 6.12% in the first quarter of 2020), the report reveals.
The personal lending market (P2P) in Indonesia has also recovered in recent years. The P2P loan is the largest fintech segment in the country, accounting for most or more than 60% of all fintech operating in the country. As has been widely reported, the P2P lending sector in Indonesia and other Asian countries has experienced scams, resulting in billions of dollars in losses.
The COVID-19 epidemic has also created many demanding situations for the country’s fintech. However, Swiss fintech corporations can now enter the country’s fintech industry by providing answers that aim to meet the needs of verification of visitor knowledge and virtual visitor wisdom (KYC). Swiss corporations can also provide credit score or credit score teams that employ non-traditional sources of knowledge.
The report also notes that investment and wealth control are another key fintech segment that can be widely followed in the country.
Others that might be suitable for Indonesia are those that will help modernize existing banking systems and IT infrastructure, the report said. He added that other fintechs would also be required through Indonesian companies, such as knowledge cleansing, knowledge research and automation of robotic processes. Cloud accounting, software as a service (SaaS), and virtual acquisition may also be required in the future.
As recently reported, more than 240 fintech corporations operate in Indonesia, which has a leading global economy in Southeast Asia.