MOVING TOWARDS

A NEW ERA IN
INDONESIA'S
FINANCIAL INDUSTRY
FINTECH REPORT 2019

© NOV 2019
 PREFACE

Fintech Report is DSResearch's annual report to provide updates on the financial

technology industry in Indonesia.

In this report, we focus on:

1. The fintech industry dynamics and its ecosystem overview in 2019.

2. Industry perspectives towards fintech growth, trends, and regulations in 2019

3. Public acceptance of usage & attitude by fintech products.

4. Prospective strategy of fintech in upcoming years

Fintech has evolved in significant ways and continuously become more mature at an accelerated pace
over the course of 2019. This year, the demand of fintech products had grown rapidly and achieved mass
adoption to people’s lifestyle. With big developments ranging from the rise of fintech products awareness
up to fintech’s impact on national GDP has become another big year for fintech.

Fintech Report 2019 is based on a nationwide survey encompassing responses from 1500 people in
nationwide. Questions sought to yield perspectives of usage and attitude in public acceptance towards
fintech products and also exploring the emergence of growth and trends in the financial industry. It sheds
light on the impact which fintech ecosystem will have on all the stakeholders, the challenges and concerns
that all sectors will face, and the emergence of new businesses and monetization models in this space.

This report is conducted by DSResearch and supported by BRI & BRI Ventures to gain more insights on
fintech’s overview in 2019.
Bank Rakyat Indonesia (BRI) is one of the largest state-owned banks in Indonesia. It’s founded in
Purwokerto, Central Java, by Raden Bei Aria Wirjaatmadja on December 16, 1895. The strength
of BRI lies in serving the segment of micro and small medium enterprises.

BRI’s vision is to provide financial services to all Indonesians nationwide, including the remote
areas. To realize this, it needs to be supported by sufficient infrastructure, including network of
branches and branchless agent throughout the archipelago. As the market keep growing, along
with its commitment, BRI keeps innovating to provide the best services to its customers.

Getting through digital era, BRIAPI, a BRI’s product, serves to enable third parties to use Bank
BRI’s financial service functions or features into their platforms in a secure and safe manner.
With BRIAPI implementation, Bank BRI is the first bank with open API system in Indonesia that
has ISO 27001 and OJK certification. BRIAPI is expected to link Bank BRI and ever-growing startup
industry, in particular to extend digital collaboration in realizing a super ecosystem to accelerate
financial inclusion and to bring ease of access of financial services to society. With this, we
believe, “No one left behind!”

BRI Ventures is the Corporate Venture Capital arm from Bank BRI, the largest bank in Indonesia. It
is established to accelerate innovation and give support to Bank BRI by investing in high-growth
companies with strong digital ecosystem-enablement angle.

Supported by the network and reach of its holding company, BRI Ventures is uniquely positioned in
the market to help entrepreneurs get a strong local presence, by building its business with real
value creation, and eventually drive Indonesia’s digital economy.
 CONTENTS

01
PREFACE 01
04
PART 1
CONTENTS 03 INTRODUCTION
FINTECH ECOSYSTEM IN 05
INDONESIA

08
PART 2
15
PART 3
INDUSTRY PERSPECTIVES PUBLIC PERSPECTIVES

GROWTH AND TREND 09 DEMOGRAPHY 16

INDUSTRY DYNAMICS 10 BANKED AND UNBANKED SOCIETY 18
REGULATIONS IN 2019 11 FINTECH'S PUBLIC PERCEPTION 19
FINTECH FUNDING 13 FINTECH PRODUCTS' AWARENESS 21
AND USAGE

45
PART 4
48
CLOSING
PROSPECTIVE STRATEGY REMARKS
FINTECH IN (NEAR) FUTURE 48
IMPACT ON ECONOMY 47
GROWTH
 05

PART 1

INTRODUCTION
 05

Fintech Ecosystem in Indonesia

The financial technology (fintech) in Indonesia offers a broad variety of financial services, including
transaction settlement, capital raising, investment management, fundraising and distribution insur-
ance, market support, equity crowdfunding, and other financial support and service activities. This
year, the scene is still highlighted by lending and payment companies.

The OJK (Indonesia’s financial services authority) has listed more than 100 licensed fintech lending
companies as of early this year, and the number is expected to grow throughout the year.

OJK also maintains various services related to digital insurance, investment, and crowdfunding;
while payment and remittance are regulated by Bank Indonesia.

The e-money apps are currently super popular to facilitate many payment activities, from shopping,
entertainment, to transportation. The introduction of QRIS to unify mobile payment transaction in
2020 will play a bigger role to shift Indonesia to be a cashless society.

We have witnessed OVO, a leading payment company, to be the first unicorn startup coming from
fintech vertical. We expect some lending companies to follow in the near future.

In the bigger picture, 99 million unbanked people, according to the e-Conomy SEA 2019 by Google,
Temasek and Bain & Company, is a huge opportunity for digital financial services to help the govern-
ment in financial inclusion issue. The research also shows the projected growth in digital financial
services in the region.

SEA Consumer Payments (GTV, $B)

2019 22B 600B 1.400B e-Wallets

Digital Payments

114B 1.100B 2.300B Consumer Payments

2025
114B 1,100B 2,300B

13% 28%
Digital Remittance
11B 28B
(Flows, $B)

3% 8%
Digital Lending
23B 110B
(Loan Book, $B)

3% 11%
Digital Investments 10B 75B
(AUM, $B)

4% 9%
Digital Insurance
2B 8B 2019 2025
(GWP, $B)

source: e-Conomy SEA 2019

 06

Fintech is considered to be as a result of the massively developed information and communication

technology infrastructures in the country during the last decade. Currently only around 60 percent
of Indonesia’s adult population have conventional banking accounts, while around 130 million
Indonesians use mobile phones to access the Internet.

This gap obviously encourages startup entrepreneurs to take advantage of those untapped opportunities.
Initially, the emerging fintech business was expected to be an initiative capable of harmonizing financial
inclusion in Indonesia through expanding access, reducing costs, and increasing efficiency. Slowly, fintech
appears and currently are considered to be commonly following this disruptive pattern. They come with
products and services that continuously improved and expanded beyond their scope.

There are some slightly different data, but both show the large amount of fintech transactions in Indonesia,
at around US$15 billion in 2017. Of that number, most of them are engaged in the payment sector, followed
by investment and lending.

TYPE OF FINTECH 100%

Total (US$15 Billion)

Investment Others
Payment

17% 16%
Point of Sales (PoS) Crowd Lending

32
funding
%
11% 9% 15%
source: Indonesia Fintech Association (2017)

Fintech, especially lending, has been arguably the fastest growing sector in recent years. The Indonesian Finan-
cial Services Authority (OJK) recorded the total financing channeled by technology-based lending service
providers as US$951 million in the first three quarters of 2018, and projects the total loan figure to grow to
US$2 billion by the end of 2019. Among the startups that received massive investments in 2018, three belong
to this sector. These include FinAccel (Kredivo) with US$30 million in Series B funding, C88 with US$28 million
Series C round, and Moka with US$24 million in Series C funding.

Aside from P2P lending, digital payment services also hold promise in Indonesia. A study by MDI Ventures and
Mandiri Capital entitled “Mobile Payments in Indonesia: Race to Big Data Domination” predicts that the mobile
payment market will reach US$30 billion in total gross transaction value by 2020, and reach a compound
annual growth rate of 158% for the period between 2016 and 2020.
 07

“Fintech is generally carried out by startup companies, although this is not

always the case. In addition, not infrequently large companies, including
conventional banking and financial services, also invest in existing fintech
businesses. Thus, while the technology provides the opportunity to
disrupt the market, we have to question the potential for fintech to really
fundamentally change the business and economic landscape.”

— Riemer et al., 2017

The main sectors exposed to this risk at the moment are financing and funding. It might not be surprising
if conventional banking will eventually only be a kind of ‘cashier’, while other products and services are
offered by fintech due to their flexibility and efficiency in operational activities.

In 2019, fintech is expected to remain at the forefront of Indonesia’s digital industry, with the potential of
collaborations with financial institutions. Fintech players will also need to form partnerships with
merchants of various sizes, from small and medium enterprises (SMEs) to big businesses, to facilitate
wider adoption. Insurance and wealth management also hold potential for fintech applications, as many
Indonesians currently do not have insurance coverage of any form.

Fintech ecosystem itself has been growing massively this year. OVO has emerged as the first unicorn
among fintech companies. Some other players, like Akulaku, Kredivo, and Modalku also have high valua-
tions at more than US$100 million. That indicates optimism and trust from investors about the potential of
the industry landscape. Signals of collaboration between players, traditional and digital, are becoming
apparent today — fintech acts to educate the market, unbankable society about various financial products.

In addition to OJK, Bank Indonesia is also being a key regulator in the ecosystem. It initiates QRIS (Quick-Re-
sponse Code Indonesia Standard) as a first step to create synergies among digital payment platforms. This
policy allows one access code to receive payments from various types of registered applications.
PART 2

INDUSTRY
PERSPECTIVES
 09
Growth and Trend
Fintech represents the collision of two worlds and the evolution of the use of technology in financial
services. Financial services and technology are locked in a firm embrace, and with this union comes
both disruption and synergies. Fintech ecosystem continued to mature at an accelerated pace over the
year. With big developments ranging from the rise of open banking, increasing regulatory clarity and
maturation of AI and blockchain, 2019 promises to be another big year for fintech.

Fintech has improved and expanded its offerings around the world, but also how it has spurred
change across the entire financial services industry. FinTech strives to make financial services more
accessible for both consumers and businesses. By connecting customers to a digital world, Fintech
enhances their experiences, making them efficient, economical, and frictionless.

2019 marked a watershed moment for the industry, with the once clear distinction between fintechs
and financial services proper now blurred significantly. Virtually every incumbent financial institution
(FI) is now looking inward and engaging in an innovation drive, spurred on by competition from
fintechs. As such, incumbents are now actively investing in, acquiring, and collaborating with their
fintech rivals.

There are several CVCs, because of the nature of the banks as their parent companies, are focusing to
invest in fintech-related startups. BRI Ventures, launched this year with $250 million fund, are currently
into fintech, fintech enabler, and digital ecosystem. Nicko Widjaja, BRI Ventures’ CEO, said, “In BRI,
there are two divisions to handle synergy with startups, one division [Digital Center of Excellence] is
specifically tasked for fintech. Bank needs to be part of fintech ecosystem. Collaborate to speed up or
expedite innovation.”

Eddi Danusaputro, Mandiri Capital’s CEO, investment arm of Bank Mandiri, added, “The recent addi-
tion of OVO into unicorn status means fintech as a vertical has reached a higher value [in valuation].
Fintech has central position to facilitate other sector in the ecosystem.”

Danusaputro acknowledges that payment and lending are more advanced, in terms of impact to
society and the number of big-valuation startups, compared to other sub sectors. However, Widjaja
believes they need to put value over valuation to build digital nation.

2017 2018 2019

Fintech’s New Player

P2P Lending 19 Player 61 Player 47 Player*

Digital Payment 6 Player 8 Player 4 Player*

Fintech Investments (DSResearch)

26 transactions 14 transactions 22 transactions*

Disclosed only
$176.7 million $182.3 million $99 million*

P2P Lending Statistics (OJK)

Total Loan Disbursed Rp22.6 trillion Rp60.4 trillion*

Number of Borrowers 4.3 million accounts 14.3 million accounts*

*data per September 2019

 10

Industry Dynamics

Lending Players (Licensed by OJK)

Starting this year, OJK has begun releasing "business licenses" for fintech lending in Indonesia. Previously, OJK
only gave a status of "registered and supervised" for players who operate online loan services. Business licenses
will increase the credibility of each company as a provider because various administrative requirements must be
met, related to compliance with customer service to the security system.

As of September 2019, 13 fintech lending players obtain business licenses and registered status. 144 others are
already registered.

Fintech Lending Players

Obtained Business Licenses and Registered Status by OJK

Investree
Danamas Amartha Dompet Kilat
https://www.investree.id
https://p2p.danamas.co.id https://amartha.com https://www.dompetkilat.co.id
PT Investree Radhika Jaya
PT Pasar Dana Pinjaman PT Amartha Mikro Fintek PT Indo Fin Tek

KIMO Tokomodal UangTeman Modalku

http://kimo.co.id https://www.tokomodal.co.id https://uangteman.com https://modalku.co.id
PT Creative Mobile Adventure PT Toko Modal Mitra Usaha PT Digital Alpha Indonesia PT Mitrausaha Indonesia Grup

KTA Kilat Kredit Pintar Maucash Finmas

https://www.pendanaan.com http://kreditpintar.co.id https://maucash.id https://www.finmas.co.id
PT Pendanaan Teknologi Nusa PT Kredit Pintar Indonesia PT Astra Welab Digital Artha PT Oriente Mas Sejahtera

KlikACC
https://klikacc.co.id
PT Aman Cermat Cepat
 11

Payment Players (Licensed by BI)

Bank Indonesia is responsible for overseeing fintech players related to e-money, e-wallet, or market support
systems. This year there are only 4 new e-money players who get licenses.

1. New E-Money License

Ottocash LinkAja Zipay PACCash

PT Transaksi Artha Gemilang PT Fintek Karya Nusantara PT Max Interactives Tecnologies PT Sarana Pactindo

E-money Issuer E-money Issuer E-money Issuer E-money Issuer

2. Registered Companies

TADA IJOY LaborPay ADAPAY

PT Aksi Prima Pratama PT Ijoy Yoro Kobi PT First Global Data Indonesia PT Barcode Integrasi Indonesia

Payment System Payment System Payment System Payment System

WalePay OnePay Cash Cash Pro So Cash

PT Walepay Finansial PT Digital Karya Bangsa PT Digital Kuantum PT Socash Software
Teknologi Teknologi Services

Payment System Supporting System Market Provisioning Supporting System

LiquidNet
PT Liquid Artha Nusantara

Supporting System
 12

Regulations in 2019
1. QR Code Indonesia Standard
Bank Indonesia initiated the QR Code Indonesia Standard (QRIS) as a digital
transformation of the payment system in Indonesia in Peraturan Bank
Indonesia (PBI) No. 21/18/PADG/2019. This regularity was also released to
accelerate the development of the economy and digital finance. From the
merchant's point of view, this standardization allows them to provide only
one QR Code and it can accept any payment apps.

There are four parties involved technically in

the implementation of QRIS, as follows:

01 Information System Service Providers; Bank or
non-bank institution conducting payment
system service.
02 Switching Institutions; An institution that
organizes switching in the National Payment
Gate (Gerbang Pembayaran Nasional - GPN).
Merchant Aggregators; In charge of acquiring
03 merchants and forwarding the proceeds of
transactions through collaboration with
payment system providers.
04 National Merchant Repositories; A system for
administering merchant data.
QRIS is also expected to present advantag-
es for end users, especially related to flexi-
bility in choosing alternative sources of
funds or payment instruments — the
transaction is limited to a maximum of 2
million Rupiah for each payment. For
industry players, it's intended to support
interconnection and
interoperability, minimizing fragmentation
— this mechanism accommodates two
business use cases, Merchant Present
Mode (MPM) and Customer Presented
Mode (CPM). In the MCM method,
merchants display QR codes for payment
to users. While on CPM, the user presents
the code for the merchant to scan.

2. Fintech Association
This year the Asosiasi Fintech Pendanaan Bersama Indonesia (AFPI) has been inaugurated as an official organi-
zation for p2p lending companies. One of the agreement points said that every company is required to register
as a member of the association. The association will also carry out oversight and regulatory functions to its
members; it includes maintaining the stabilization of business growth.

AFPI has planned annual work agendas. The first program is an internal certification of business processes and
customer service. That was prepared to improve the quality of lending services among the presence of new-
comers in the sector. They will also develop data centers to facilitate innovations related to management and
credit risk assessment.

OJK also appointed the Indonesian Fintech Association (Asosiasi Fintech Indonesia - AFTECH) as the official orga-
nization organizing Digital Financial Innovations (Inovasi Keuangan Digital - IKD). The aim is to build supervision
of fintech service providers with new business models that have not been accommodated by regulations. So far,
only two types of fintech have been regulated, p2p lending and equity crowdfunding.
 13

Fintech Funding
As of early November 2019, there are 22 announced funding rounds for fintech startups with a shy of $100
million in total disclosed amount. It’s almost half of last year’s number (a total of $182 million). Koinworks and
Kredivo, both are fintech lending companies, dominate the funding scene this year.

2019

January

KoinWorks Dana Cita Ajaib

Series A Seed Funding Seed Funding
$13.6 million Undisclosed $2.1 million

February April

Akseleran Chaslez
Series A Series A
$2.5 million Undisclosed

May

Lubna Aino Stockbit

Seed Funding Seed Funding Series A
Undisclosed Undisclosed Undisclosed

Alami Qoala Gradana

Seed Funding Seed Funding Pre-Series A
Undisclosed $1.5 million Undisclosed

June July

KoinWorks Kredivo
Series B Series B
$ 16.2 million Undisclosed
 14

August

UangTeman
Series B
$5 million

September

Julo Crowde Kredivo

Series A Pre-Series A Venture Debt
$10 million $1 million $20 million

UangMe Pluang
Seed Funding Series A
$24 million $3 million

November

KoinWorks Amartha
Series B Series B
Undisclosed Undisclosed

Stage
Fund
PART 3
PUBLIC
PERSPECTIVES
 16
Demography
To understand better about public perspective on Fintech and its products, DSResearch
conducted an online survey involving 1500 respondents nationwide.

Gender

59.3% 40.7%

Age Group

50.7%

24.5%

19.1%

4.7%
1.1%

< 20 y.o 20 - 29 y.o 30 - 39 y.o 40 - 49 y.o > 50 y.o

SEC (Monthly Household Expenditure)

A 25.8%
(> Rp 5 mill.)

B 58.9%
(Rp2,5 - 5 mill.)

C1 14.3%
(Rp1,75 - 2,5 mill.)

C2
(< Rp1,75 mill.)
1.0%
 17
Cities

MEDAN 2.3%

BALIKPAPAN 0.5%

MAKASSAR 0.9%

OTHERS

69.5%
17.1%
JABODETABEK
SURABAYA 3.4%

BANDUNG 6.3%
 18

Banked and Unbanked Society

Ease of financial access is one of the needs in supporting economic activities. Bankable can be interpreted
as 'Customer who meets the requirements of the Bank', where intended to meet the requirements of the
bank are individuals both as debtor customers, as well as savings or deposit customers, or the wider com-
munity who need banking services.

6.3% 17.9% I'm not actively using

any bank accounts
I'm actively use more
than 3 bank account

6.2%
I'm actively use
3 bank accounts

21.5%
I'm actively use
2 bank accounts
n=1500

48.0%
I'm actively use
1 bank account

3.5%
I'm actively use more
than 3 mobile banking apps

12.5% 39.2% I'm not actively using any

mobile banking apps
I'm actively use
2 mobile banking app

n=1500

3.5%
I'm actively use
3 mobile banking app 41.3% I'm actively use
1 mobile banking app

It’s revealed that more than 80% of people have been actively use bank accounts. Surprisingly, only 60%
have been using mobile banking apps. Smartphone penetration is one of the factors why the technology
industry is getting bigger, but it doesn’t give much effects, yet, on digital literacy of using mobile banking
apps.
 19

Fintech's Public Perception

In terms of financial services, Fintech appears as a financial service innovation aimed at simplifying the
process so as to facilitate the public to gain access to financial products and improve financial literacy. The
emergence of fintech is expected to be a solution to financial inclusion and increase the number of people
exposed to financial services (bankable).

I'm really aware

I'm not really aware
about FINTECH
47.5%
about FINTECH

8.3%

I'm quite aware

about FINTECH
22.8% 21.4% I'm slightly aware
of FINTECH

[n=1500]

In regard to survey result, almost 50% people aren’t really aware about FINTECH at first impression. The
gaps of understanding of male and female can be seen by gender breakdown, while more than 60%
male aren’t really aware about FINTECH. Moreover, those who belongs to age group of 20 ~ 29 y.o and
SEC of B class consider to be more aware about FINTECH perception.
 20

By Age Group Breakdown [n=1500]

13.7%
54.0%
I'm really aware about FINTECH 26.6% < 20 y.0
5.6%
0.0% 20~29 y.0
7.3%
30~39 y.o
51.8%
I'm quite aware about FINTECH 34.2%
40~49 y.o
5.3%
1.5%
> 50 y.o
5.9%
53.9%
I'm slightly aware of FINTECH 33.0%
5.6%
1.6%
31.6%
48.1%
I'm not really aware about FINTECH 15.7%
3.8%
0.8%

By SEC (Monthly Household Expenditure) Breakdown [n=1500]

57.0% 59.8% 60.9%

50.8%

40.3%

34.2%

26.8%

18.8% 18.7%
12.8%
8.9%
8.5%

0.0% 0.3% 0.6% 1.7%

I'm really aware I'm quite aware I'm slightly aware I'm not really
about FINTECH about FINTECH of FINTECH aware about
FINTECH

> Rp5 mill.

Rp2.5 - 5 mill.

Rp1.75 - 2.5 mill.

< Rp1.75 mill.

 21
Fintech Products' Awareness and Usage
Fintech has been used for many of the newest technological developments - from payment apps like
GoPay or Kredivo to P2P Lending. Combining the latest technological developments with financial
services or applications, fintech has helped businesses - largely start-ups - disrupt the industry and
provide better financial services to businesses and individuals alike. Fintech aims to improve the delivery
of financial services and make them more accessible to the public.

Many fintech products are designed to connect consumers' finances with technology for ease of use,
although the term is also applied to business-to-business (B2B) technologies as well. Fintech has made
inroads with dozens of applications and has changed the way consumers access their finances.

DSResearch had conducted online public surveys to figure out how’s the usage and attitude of current
market in understanding more on fintech products. Here are some results:

82.7% 62.4% 56.7%

Investment Paylater
Digital Wallet

40.0% 39.1% 21.5%

Insurtech P2P Business
Online Multifinance
Lending

17.3% 6.9% 4.4%

Crowdfunding Remittance Don’t Know

n=787

More than 80% people aware about Digital wallet, Investment, and Paylater as fintech products. It proves that
people consider it as popular financial products when it’s related with technology. It accounts for 82.7% of people
who are aware of digital wallet, 62.4% who are aware of investment, and 56.7% who are aware of paylater.

31.5% 30.9%
79.9% Investment Paylater
Digital Wallet

12.0% 11.8% 8.2%

Online Multifinance Insurtech Crowdfunding

6.2% 3.3% 2.4%

P2P Business Never use Remittance
Lending

n=747
 22

By Gender Breakdown [n=747]

Digital Wallet Paylater Investment

78.7% 31.1% 29.1%

81.6% 30.7% 33.2%

Online Multifinance Insurtech Crowdfunding

14.4% 12.3% 8.4%

8.9% 11.1% 7.9%

P2P Business Lending Don’t know Remittance

6.7% 3.2% 2.8%
5.4% 3.5% 1.9%

Male Female

By SEC Breakdown [n=747]

Insurtech Crowdfunding Digital Wallet

13.3% 8.7% 78.0%
11.6% 8.6% 80.0%
8.2% 4.1% 84.9%
0.0% 0.0% 100.0%

Investment Online Multifinance P2P Business Lending

32.8% 12.4% 5.8%
30.9% 13.3% 7.0%
31.5% 4.1% 2.7%
0.0% 0.0% 0.0%

Paylater Remittance Don't know

34.9% 2.5% 3.3% > Rp5 mill.
30.5% 2.3% 3.5%
Rp2.5 - 5 mill.
21.9% 2.7% 2.7%
0.0% 0.0% 0.0% Rp1.75 - 2,5 mill.
< Rp1.75 mill.

Digital wallet leads as the most used fintech products over 2019. It achieve almost 80% users nationwide.
Followed by gender breakdown’s rank, it can be found that top 3 products’ used by male are Digital wallet
(78.7%), Investment (33.2%) and Paylater (31.1%), and a bit different ranks with top 3 fintech products used by
female, those are Digital wallet (81.6%), Paylater (30.7%) and Investment (29.1%). Investment products attracts
more for male rather than female. Besides that, based on SEC breakdown’s rank, it’s quite attractive when
comparing Insurtech and P2P Lending, which B class segmentation prefer to use P2P Lending, while A and C1
class segmentation prefer to use Insurtech.
 23
74.3%

n=747

9.8%
6.8%
4.7% 1.9% 1.1% 0.8% 0.1%

Digital Paylater Investment P2P Personal Insurtech Online Crowdfunding Remittance

Wallet Lending Multifinance

7 out of 10 people have seen Digital Wallet at most during 2019. Digital wallets will likely become rich
marketing platforms with the capability to drive in-store traffic and sales, as well as result in higher
conversion rates that could overtake mobile coupons. More compelling features within wallets will
also fuel consumers to use them more frequently. According to the study, Digital Wallets: Service
Provider Analysis, Market Opportunities & Forecasts 2019-2024, strongest growth is expected to
come through online payments for remote purchases. The study argued that increases here would be
driven by a greater volume of transactions conducted via stored credentials.

51.5%
n=747

23.2%

10.7%

4.7% 3.5% 3.1% 1.5% 0.1%

Digital Investment Pay later Insurtech P2P Personal Online Crowdfunding Remittance
Wallet Lending Multifinance

Still, in terms of intention to use fintech products in next year, Digital Wallet leads the orders with percentage
of 51.5%. The high rate of mobile devices usage in Indonesia drives reason towards many companies take
advantage of this device as a media in electronic payment transactions. In general, the use of mobile devices
to facilitate consumer payments to merchants in e-commerce transactions are using the concept of e-wallet
and known as a digital wallet.

Trusted Products 78.0% n=722

Suitable to people needs 68.7%

Functional 67.2%

Easy to be used 64.7%

Alternative of financial services 63.9%

Saving time 62.5%

Detail information of products 48.8%

Complete product's option 30.6%

People recommendation doesn’t indicate
Popular products 28.9% much impacts for people to use fintech
People recommendation 16.1% products. It’s only shown with less than
20% users consider these factor.
 24

Not suitable Unpotential n=722

to market needs
55.6% advantages 22.2%

No
Untrusted recommendation 22.2%
Products 22.2%
from others

Not easy to Religious

understand the 14.8% issues 11.1%
products

Unimpressive Unpopular
products 11.1% products 7.4 %

Less product’s Incomplete

variant 3.7% product’s 3.7%
information

More than 50% people consider that current products still doesn’t suitable to market needs.
Since this background derives, it could be a good signal for fintech players to boost up how their
products could fulfill market demands and increase more users in upcoming years.

Attractive
51.9% n=722
promotions

Guaranteed Provide Provide varied

security of 48.1% interesting 29.6% products 11.1%
Personal data products

Provide suitable Provides Popular brand

products 40.7% products that
29.6% ambassador
11.1%
are easy to use

Clear and
informative Availability Provide unique
product’s
37.0% 29.6% 7.4%
of promotions products
information

Attractive promotions will become the main points where potential users could be interested to use fintech
products. However, brand ambassador doesn’t share much impacts to boost up usership fintech products.
 25

Insurtech
Insurtech refers to the use of technology innovations designed to squeeze out savings and efficiency from
the current insurance industry model. Insurtech is a combination of the words “insurance” and “technology,”
inspired by the term fintech. This approach does, of course, result in some people paying more than they
should be based on the basic level of data used to group people. Among other things, insurtech is looking to
tackle this data and analysis issue head-on. Insurtech will continue to optimise the insurance industry by
improving insurance products, enhancing service compatibility and lowering regulatory costs. In these ways,
insurtech will construct a rich and resourceful "new insurance" ecosystem.

Top 10 insurtech sites / apps awareness [n=308]

Axa.co.id Allianz.co.id Asuransiku.id Zurich.co.id

42.2% 3.6% 0.0% 0.0%
59.7% 37.3% 0.3% 31.2%
89.6% 85,1% 51.0% 50.6%

iFwd.co.id RajaPremi AturDuit Jagadiri

1.9%
1.3% 0.3% 1.6%
32.5%
4.5% 1.3% 15.9%
45.1%
39.3% 38.3% 32.8%

Top of Mind Awareness

PasarPolis Manulife.co.id
Unaided Awareness
1.0% 2.6%
4.9% 22.7%
Total Awareness
2.0% 22.7%

AXA leads as the most popular insurtech with percentage of 89.6% in total awareness. It defines
that AXA dominates the proportion of people who have seen or heard of insurtech in public’s topic.
However, when it’s mentioned about insurtech at people’s top of mind, Manulife comes up to top
three among other insurtechs.
 26

Top 10 insurtech sites / apps used in 2019 [n=219]

Allianz.co.id Axa.co.id RajaPremi Zurich.co.id

36.9% 33.7% 21.2% 13.1%

Asuransiku.id AturDuit Jagadiri PasarPolis

15.4% 10.5% 11.4% 11.8%

Futuready Asura.co.id

9.2% 9.83%

By Age Group Breakdown [n=219]

32.1% 3.6%
31.3% 8.8%
Allianz.co.id 46.2% PasarPolis 17.9%
30.8% 7.7%

21.4% 3.6%
32.7% 12.2%
38.5% 10.3%
Jagadiri
23.1%
30.8%
Axa.co.id

25.0% 0.0%
25.2% 9.5%
15.4% AturDuit 12.8 %
RajaPremi 23.1% 23.1%

21.4% 0.0%
19.0% 13.6%

Asuransiku.id 9.4% 7.7%

15.4%
Asura.co.id 7.7%

3.6% 3.6%
13.6% 5.4%
15.4% 15.4%
Zurich.co.id Futuready
7.7% 7.7%
 27
By SEC Breakdown [n=219]

37.8% 13.3%
38.2% 11.8%
Allianz.co.id 26.7% PasarPolis 6.7%

43.3% 17.8%
29.0% 9.1%
33.3% Jagadiri 6.7%

Axa.co.id
22.2% 16.7%
19.9% 7.5%
26.7% 10.0%
RajaPremi AturDuit

20.0% 15.6%
12.9% 7.0%
Asuransiku.id 16.7% Asura.co.id 10.0%

16.7% 10.0%
12.9% 9.7%
Zurich.co.id 3.3% Futuready 3.3%

> Rp5 mill. Rp2.5 - 5 mill. Rp1.75 - 2.5 mill.

36.9% people have been used Allianz along this year. Followed by Axa with percentage of 33.7% and RajaPremi
with percentage of 21.2%. Among those new insurtech sites / apps, RajaPremi leads the usership ranks instead
of Asuransiku.id, PasarPolis, etc. According to demography breakdown of age group, it can be inferred that there
are slightly differences of sites / apps usage among the groups. Younger age and 30 - 39 y.o groups prefer to use
Allianz, 20 - 29 y.o groups prefer to use Axa, and older group of 40 - 49 y.o prefer to use Jagadiri. Moreover, based
on SEC breakdown, B and C1 segmentation rather to use Axa, while A segmentation rather to use Allianz.

People Recommendation Trusted products Popular products

34.1% 81.8% 59.1%

Detail information of products Complete product’s option Suitable to people needs

67.0% 65.9% 81.8%

Easy to be used Functional Alternative of financial services

75.9% 73.9% 73.9%

Saving time

79.5% n=219

Strong consideration by trusted products and its suitability to people needs are mostly chosen by insurtech
products which shown by percentage of 81.8%. It pictures how trusted products and suitability to market needs
are what people might be looking for when searching for insurtech.
 28

Equity Crowdfunding
Recently, equity crowdfunding is the new way for everyday investors, workers, and the millennial
generation, to invest in early-stage and growth-stage businesses. It’s a variation on the crowdsource
model that allows the general public to purchase shares in an existing business or a startup.

Crowdfunding involves funding a project with relatively modest contributions from a large group of
individuals, rather than seeking substantial sums from a small number of investors, as has traditionally
been the case for businesses funded with venture capital (VC) or other private equity. Equity-based
campaigns are typically used to launch a startup or to provide funds for a new business venture for an
established company.

HOW EQUITY CROWDFUNDING WORKS

1 2

Company approaches Platform approves business

crowdfunding platform

3 4

Crowd funds company Crowd has equity in company

 29

Top Equity Crowdfunding sites / apps awareness [n=136]

0.0%
8.1%
0.0%
32.4%
26.5%
Indiegogo 66.2%
Greenfund

0.0%
16.2% 0.0%
27.9% 26.5%
Crowdfunder 64.0%
Alumnia.id
18.4%
20.6% 20.6%
27.9% 22.8%
Kolase 62.5% Santara

0.7% 0.0%
0.7% 0.7%
ModalSaham 48.5% Symbid 0.7 %

Top of Mind Awareness Unaided Awareness Total Awareness

When people talk about general crowdfunding platforms in Indonesia, one name always pops up as
top-of-mind. As one of the first companies to implement such a concept in the market, Kitabisa has
acquired enough mindshare to be the go-to crowdfunding platform in the country.

In its development, crowdfunding is divided into four types. Kitabisa belongs to donation crowdfunding,
while our focus is on equity crowdfunding.

Indiegogo, Crowdfunder and Kolase becomes top-of-mind for equity crowdfunding in nationwide during
2019. It can be shown that their percentages are slightly different among each other. Furthermore,
equity crowdfunding market has been growing more than 60% of public awareness among those who
aware of equity crowdfunding existence.
 30

Top equity crowdfunding sites / apps used in 2019 [n=86]

Crowdfunder ModalSaham Greenfund

30.9% 38.7% 27.2%

Indiegogo Kolase Alumnia.id

24.3% 23.5% 17.6%

Santara Symbid

5.9% 0.7%

Crowdfunder manage its position become the most used equity crowdfunding sites / apps in 2019.
Next, ModalSaham & Greenfund also establish their position which accounts for 28.7% and 27.2%.
Amidst of top 5 equity crowdfunding sites / apps recently used, there’s only slight differences in user-
ship percentage. It declares the competitive usage of its functional towards public demand.

People Recommendation Trusted products Popular products

24.6% 82.0% 55.7%

Detail information of products Complete product’s option Suitable to people needs

67.2% 65.6% 85.2%

Easy to be used Functional Alternative of financial services

70.5% 78.7% 75.4%

Saving time n=86

77.0%

At least 8 out of 10 people agree that equity crowdfunding sites have to be suitable to people
needs as well as has to be trusted for their image in users. Still, people recommendation
doesn’t give much effect how public use crowdfunding sites / apps. There are several reasons
why people use equity crowdfunding sites / apps.
 31

Digital Wallet

Digital wallet is also called as e-wallet. As simplify, it’s a transformation in the way people pay for
things. An E-wallet needs to be linked with the individual’s bank account to make payments. Digital
wallets often have many more functions, including person-to-person (P2P) payments and other
payment methods, balance-inquiry and reporting functions, support of loyalty programs (rewards,
coupons), and other functions.

FUNCTIONS OF DIGITAL WALLET

Interaction Information Security, Shopping Customer

alternatives Access Payment and Relationship
Financial Services Building

Web/App Search In-store/ Promotions, Loyalty program

Social media
Proximity NFC digital coupons

Mapping-Directions In-app/Mobile web Ticketing - Targeted

Text Message entertaintment, advertising
travel,
sports events

In-store navigation, Access control- Transport- Location

Email product discovery security-account parking, based marketing
management, transit tolls
Identity storage
(National ID cards, etc.)

Voice Shopping companion Mobil banking, Gift cards,

-price comparison, financial services, vouchers
product information, P2P payments
shopping list

Source: Aite Group

 32

Top 10 digital wallet awareness [n=651]

37.0%
89.6%
OVO 99.5%

15.2% 0.5%
85.4% 12.4%
Gopay 98.5% Sakuku 53.6%

30.7%
77.7%
0.5%
98.3%
Dana 9.5%
iSaku 34.4%
3.4%
LinkAja 61.1%
84.6%
0.5%
9.1% 2.3%
DOKU 24.9% Uangku
29.2%
58.8%

0.5%
4.5%
56.1% Top of Mind Awareness
Paytren
0.2% Unaided Awareness
7.5%
55.3% Total Awareness
Jenius

With the continual campaign of cashless transactions, more usage of digital wallets are getting
increased, These percentage is an attempt on how the digital wallet can increase their user’s aware-
ness base. Within 2019, OVO, GoPay and DANA have all made moves in the “digital wallet” arena with
percentage of more than 90%.

Top 10 digital wallet used in 2019 [n=651]

Gopay OVO Dana LinkAja

83.3% 81.4% 68.2% 53.0%

DOKU Jenius Paytren iSaku

19.7% 16.7% 13.2% 12.1%

Sakuku Uangku

10.3% 6.3%
 33
By Gender Breakdown [n=651]

82.3% 82.8%
Gopay OVO
84.5% 79.5%

67.6% 54.4%
Dana LinkAja
69.1% 51.1%

23.1% 14.7%
DOKU Jenius
15.1% 19.4%

Paytren 12.1% 10.7%

14.7% iSaku
14.0%

Male
Sakuku 8.6% Uangku 6.4%
12.6% 6.1% Female

More than 80% people have been used GoPay and OVO with competitive percentage of its usage. GoPay and OVO
puts their position still in first and second in terms of usership of digital wallet in 2019. By exploring demography
sections, it’s quite compelling that male prefer to use OVO rather than GoPay, while female prefer to use GoPay
rather than OVO with slight differences in its usership percentages.

Trusted products Popular products

People Recommendation
15.4% 81.6% 30.5%

Detail information of products Complete product’s option Suitable to people needs

51.3% 32.8% 72.2%

Easy to be used Functional Alternative of financial services

68.3% 72.9% 67.3%

Saving time
n=651
66.2%

Consideration to use digital wallet are mostly based on its trust on the image of the product itself. Seeking
into each products’ user, DOKU user tend to use it because its suitability to people’s needs. As information,
DOKU is connected to more than 20 banks and financial institutions in Indonesia, giving merchants a compre-
hensive payment method, ranging from credit card payments, bank transfer, e-Wallet also offline payments
at selected convenience stores. Therefore, DOKU might be one of various options within digital wallet which
perfectly conform to people essentials.
 34

Investment
Investment platform accommodates the user's need to allocate funds to buy several types of commodities,
such as gold, mutual funds, stocks or term loans. Some services integrate themselves with popular sites like
an online marketplace or digital wallet, to gain higher traction.

In addition to the transaction element, investment apps in general also provide market education and analy-
sis channels. Investment commodities have dynamic fluctuations. Currently many apps can be used to help
investment activities. This section will explain the most popular services based on certain criteria.

Top 10 investment awareness [n=486]

9.1% 12.3%
34.8% 14.8%
Bareksa 61.9% Invisee 41.1%

1.9% 5.1%
19.5% 23.9%
Tanamduit 55.4% 23.6%
Bukalapak

10.9% 18.5%
30.2% Reksadana/ 23.3%
Bibit 49.9% Emas 23.0%

4.7% 0.6%
7.2% 1.9%
E-mas 47.9% 18.2%
Stockbit

6.4% 1.0%
19.3% 1.6%
Ajaib 47.3% RaizInvest 17.5%

Top of Mind Awareness

Unaided Awareness

Total Awareness

Almost 62% people acknowledge Bareksa as first investment sites / apps in terms of total awareness
among others. Besides, people also recognize BukaEmas / BukaReksa and Tokopedia ReksaDana / Emas
as one of top 10 investment sites / apps, while it’s only part of features on the e-commerce sites.

Top 10 investment used in 2019 [n=379]

30,7%
25.4%
20.9%
18.6% 15.0% 14.6%
7.6%
6.8% 6.6% 6.3%

E-mas Bareksa Invisee Tanamduit Bibit Ajaib Pluang RaizInvest Kelola Stockbit
 35

By SEC Breakdown [n=747]

31.0% 30.3% 18.7%

E-mas 31.4% 24.0% 19.2%
26.7% Bareksa 17.8% Invisee 35.6%

18.1% 19.4% 18.7%

19.9% 13.3% 13.3%
Tanamduit 13.3% Bibit 11.1% Ajaib 8.9%

11.0% 9.7% 9.7%

5.9% 5.9% 5.2%
Pluang 6.7% RaizInvest 6.7% Kelola 6.7%

8.4%
5.9% > Rp5 mill. Rp2.5 - 5 mill. Rp1.75 - 2.5 mill.
Stockbit 2.2%

E-mas acquire more than 30% usership on investment sites / apps. With classification of SEC breakdown, it can
be inferred that C1 class choose Invisee more than others which accounts for 35.6%, while A and B class
choose E-mas which accounts for 31.0% and 31.4% respectively.

According to company data, Bareksa currently has approximately 750,000 users in total, with almost 100%
growth this year (as of November 2019). Meanwhile, as of now e-mas has been downloaded by 350,000 users.
On average, the monthly active users reach 150,000 users. Until November 2019, user growth has reached
25% year-on-year.
 36
Online Multifinance

Online multifinance is a type of short-term borrowing where a lender will extend high-interest credit
based on a borrower’s income and credit profile. Its principal is typically a portion of a borrower’s next
paycheck. These loans charge high-interest rates for short-term immediate credit. These loans are also
called cash advance loans or check advance loans.

These fintech product have a simple application process. User only provide their identification, banking,
and other details, and once approved, receive their loan funds either right away or within 24 hours. The
business explains its service as offering a much-needed option to people who can use a little help from
time to time. The company makes money through upfront loan fees and interest charges on existing
loans.

Top 10 Online Multifinance awareness [n=343]

8.8% 7.0%
Top of Mind Awareness
16.7% 12.0%
Akulaku 86.0% UangTeman 43.7% Unaided Awareness

Total Awareness
29.2% 0.0%
36.3% 0.3%
TunaiKita
Kredivo 84.0% 38.4%

0.9% 0.3%
2.9% 1.8%
Home Credit 51.3% Tunaiku 27.1%

1.2% 8.1%
3.5% 32.4%
Kreditmu 1.8%
48.1% RupiahCepat

11.4% 8.1%
20.5% 32.4%
Dana Bijak 47.8% Julo 1.8%

The growth in online multifinance market is poised to witness accelerated growth owing to increased
awareness among the public regarding the lower rates of interests and greater transparency offered
by lending platforms, as compared to financial institutions.

In 2019, Kredivo and Akulaku competes each other in gaining more than 80% public awareness in
terms of online multifinance.

Top 10 Online Multifinance used in 2019 [n=330]

65.9% 63.0%

30.6%
27.1%
19.8% 16.9% 15.2% 13.7% 11.1% 10.2%

Akulaku Kredivo Home Kreditmu Dana Bijak UangTeman TunaiKita Tunaiku RupiahCepat Julo
Credit
 37

By Gender Breakdown [n=330]

68.2% 68.2%
61.3% Kredivo 55.6%
Akulaku

25.4% 31.3%
38.0% Kreditmu 21.1%
Home Credit

21.9% 17.4%
16.9% 16.2%
Dana Bijak UangTeman

15.4% 13.9%
14.8% 13.4%
TunaiKita Tunaiku

11.9% 10.9%
9.9% Julo 9.2%
RupiahCepat

Male Female

Akulaku achieve highest percentage in terms of online multifinance usership in 2019. Akulaku still
becomes strong competitor with Kredivo. It reveals that Akulaku and Kredivo become powerful players
in P2P Personal Lending this year. Deep dive more into gender breakdown, female users tend to use
Kreditmu, while male users tend to use Home Credit first.

People Recommendation Trusted products Popular products

21.1% 72.7% 48.9%

Detail information of products Complete product’s option Suitable to people needs

64.4% 42.2% 77.8%

Easy to be used Functional Alternative of financial services

64.4% 62.2% 70.0%

Saving time

63.3%
n=330
 38
P2P Lending

When it comes to crowd-based funding, online venues that cater to individuals have attracted
most of the attention. This is not surprising given that the alternative finance models that have
accounted for the largest share of activity in recent years are peer-to-peer (P2P) consumer lend-
ing platforms. But what many people might not realize is that alternative business funding
volumes have also been growing rapidly.

From the borrower’s perspective, approaching a P2P lending platform for a loan is much like
applying with any other business lender. They’ll ask about business turnover, profits and trading
history. They’ll want to see bank statements and filed accounts, and plans for the money.

Top 10 P2P Lending awareness [n=254]

16.1% 0.4%
30.3% 2.4% Top of Mind Awareness
Koinworks 52.8% ModalRakyat 32.3%
Unaided Awareness
4.3% 13.8%
19.3% 26.0% Total Awareness
investree 51.2% 26.0%
Danamas

4.3% 0.0%
26.4% 0.4%
Modalku 47.2% Mekar.id 20.9%

11.8% 0.8%
31.9% 1.2%
Amartha 46.1% 15.7%
Taralite

10.2% 12.6%
Akseleran 16.5% 15.0%
35.4%
Asetku
15.0%

KoinWorks is one of leading Indonesian Fintech Lending company, provides online P2P Lending services
with innovative machine learning, connecting Lenders & Borrowers into an online platform. Lenders can
start lending with as low as IDR 100,000 and Borrowers can apply for a loan online with low monthly
interest rate. It’s proved by almost 80% public awareness.

KoinWorks are having its closely competitive positioning with Investree which accounts for 52.8% and
51.2%. Amartha put their positioning in 4th place after Modalku.
 39

Top 10 P2P Lending used in 2019 [n=254]

29.9%
22.0%
20.5%
16.5% 12.2%
10.6% 10.2% 9.4%
7.9% 5.9%

Koinworks Investree Modalku Amartha ModalRakyat Danamas Akseleran Mekar.id Taralite Asetku

By Age Group Breakdown [n=254]

42.9% 0.0%
27.1% 12.4%
39.8% 9.7%
Koinworks Danamas
4.8% 4.8%

14.3% 14.3%
21.7% 12.4%
investree 26.9% 7.5%
9.5% Akseleran 9.5%

14.3% 14.3%
15.5% 10.1%
28.0% 7.5%
Modalku 23.8% Mekar.id 9.5%

28.6% 0.0%
13.2% 7.8%
22.6% 8.6%
Amartha 9.5%
Taralite 9.5%

0.0% 0.0%
14,0% 5.4%
10.8% 6.5%
ModalRakyat 14.3%
Asetku 9.5%

Since it’s achieve highest percentage in P2P Lending awareness, Koinworks also get most users in
2019. Additionally, Modalku gain more users for 30 y.o and above class segmentation. Modalku
was founded in 2016 by purpose of supporting SME owners in starting or growing their businesses
by providing access to funding from individual as well as institutional lenders.
 40

People Recommendation Trusted products Popular products

28.3% 82.6% 63.0%

Detail information of products Complete product’s option Suitable to people needs

78.3% 71.7% 87.0%

Easy to be used Functional Alternative of financial services

78.3% 80.4% 87.0%

Saving time n=254

80.4%

A bit different fact from other fintech products, while trusted products becomes dominant factor to use
the services / products, in P2P Business Loan, the major considerations to use it are suitability to people
needs and its alternative of financial services which accounts for 87%. Nearly all users of P2P Business
Loan sites/apps also consider its functionality when they decide to use it.
 41

Paylater
PayLater is introduced as a new payment feature to facilitate customers with credit under a
certain limit. PayLater is one of the trends that millennial interest in lately. Several large
application companies such as Gojek, OVO (through Tokopedia), and Traveloka aggressively
promote this feature on their platforms. It can be used for traveling, food purchases,
day-to-day transportation to many other consumption products.

Paylater awareness [n=466]

44.2% 0.0%
79.6% 9.0% Top of Mind Awareness
OVO 93.0% Pegipegi 38.8%
Unaided Awareness
15.5% 9.2%
65.0% 33.9% Total Awareness
Gojek 83.0% 33.9%
Kredivo

8.1% 2.9%
51.3% 27.8%
Traveloka 76.7% Akulaku 27.8%

12.3% 0.4%
41.5% 5.6%
Shopee 65.2% Bukalapak 5.6%

People become more loyal by using this service and be encouraged to spend more if they don’t
need to pay a lump sum in one go. The awareness has put OVO (through Tokopedia) to the first
place among apps which provide paylater features.

Paylater apps used in 2019 [n=347]

OVO Gojek Shopee

51.9% 49.9% 34.8%

Traveloka PegiPegi Bukalapak

31.7% 7.6% 0.2%

Akulaku Kredivo

0.2% 0.0%
 42

By SEC Breakdown [n=347]

52.8% 50.9% 30.8%

OVO 52.0% 49.2% 38.7%
47.4% GOJEK 50.0% Tokopedia 36.8%

33.3% 32.1% 10.7%

36.3% 31.9% 6.5%
Shopee 31.6% Traveloka 28.9% 2. 6%
PegiPegi

0.6% 0.0%
0.0% 0.4%
Bukalapak 0.0% Akulaku 0.0%

> Rp5 mill. Rp2.5 - 5 mill. Rp1.75 - 2.5 mill.

OVO and Gojek competes each other in acquiring usership in 2019. Both apps are being supported by
nearly 50% users nationwide. Expansion of paylater campaign from these apps has been successfully
gain public attention. By seeking deeply on SEC breakdown, C1 class segmentation prefer to use Paylater
in Gojek when A and B class segmentation prefer to use Paylater in OVO (through Tokopedia).

People Recommendation Trusted products Popular products

24.7% 81.0% 35.1%

Detail information of products Complete product’s option Suitable to people needs

53.2% 43.3% 78.8%

Easy to be used Functional Alternative of financial services

61.5% 67.5% 73.2%

Saving time n=347

62.3%
 43
Remittance

Digital disruption also provides a new way for people to send and receive funds abroad. In financial
terminology, it is called remittance. Through the traditional remittance, the process is dependent
on the bank. The efficiency presented by digital technology has made the process more affordable.

In Indonesia so far the startup landscape in remittance is still limited if compared to other vertical.
Most fintech products in remittance are created by foreign companies. One of the most popular
remittance startups is TransferWise and it has accommodated the ability to directly send fund to
GoPay, OVO, and DANA.

Remittance awareness [n=54]

31.5%
27.8%
25.9%
24.1% 22.2% 20.4%

11.1% 11.1%
9.3% 9.3%

GME Hanpas PayRemit E9Pay (KOR) MoRe by Remittance Demand Draft Brifast Top Remit
Remittance BNI BCA Remittance Remittance Remit Kilat

Not many of these products are created by local startups. In this scene, bank’s product, from BNI
and BCA, are still highlighted to be the go-to service for remittance.

Remittance used in 2019 [n=22]

38.9% 33.3%
22.2%
11.1% 11.1% 11.1% 11.1% 11.1%
5.6% 5.6%

MoRe Top Remit Remittance TrueMoney RemitPro RemitKilat Mandiri Dolarindo.com Yes Warindo.co.id
by BNI - BCA remittance Remit
 44

People Recommendation Trusted products Popular products

61.1% 88.9% 77.8%

Detail information of products Complete product’s option Suitable to people needs

88.9% 83.3% 100.0%

Easy to be used Functional Alternative of financial services

72.7% 88.9% 94.4%

Saving time
n=22
83.3%

Remittance products from banking industry are acquiring more users rather than private company.
It can be shown by graphs which MoRe by BNI as remittance products of BNI gets almost 40% users.
“MoRe” or BNI Mobile Remittance is remittance application that allows people to transfer money
easily to Indonesia on their smartphone. provides an easy, safe, fast and trusted money transfer to
any banks in Indonesia.
PART 4
PROSPECTIVE
STRATEGY
 46

Fintech in (near) Future

According to e-Conomy SEA, starting this year, fintech has played an important portion of the internet
economy in Southeast Asia. The calculation based on some variables, from user penetration, valuation,
and future projection. The business model allows for rapid growth because in some use-cases the
fintech is being a complementary service. For example in e-commerce, the digital wallet decisively
evolves to be the most popular payment option, compared to credit cards and/or cash. A new approach
is also offered, for instance, a loan without collateral scheme with a simpler administrative process.

5 SECTORS OF THE INTERNET ECONOMY COVERED

FINANCIAL SERVICES INCLUDED AMIDST
INCREASING ADOPTION

e-Commerce Media Ride Hailing Travel Financial Services

Marketplaces Advertising Transport Flights Payment

(SMB2C) Gaming Food Delivery Hotels Remittance
Mails (B2C) Video on Demand Vacation Rentals Lending
"Brand.Com" Music on Demad Investing
Insurance

Just like every other industry, the financial sector has been influenced by technological disruption. The fusion
of financial services and technology now operates under the name of “fintech,” which has now become a
mainstream term. Fintech is more than just online banking. And it grows into one of the most vibrant and
rapidly-changing areas of technological innovation.

However, investments in fintech technologies are becoming more selective. According to a KPMG report,
venture capital investors are spending more money on fewer deals today. In 2018, the total amount of funds
invested is US$39.57 billion across 1,707 deals. A year earlier, it was US$13 billion with more than twice the
amount of deals (3,813).

While the initial environment of fintech focused on single service/product led to a certain amount of unbun-
dling in the marketplace, the dynamics in the current market are shifting. There is a shift towards developing
ecosystems of integrated products/services, which, at times, may mean an integrated offering from a single
provider, but also could mean curating a set of providers into a central platform through partnerships.
 47

The financial sector is undergoing a profound transformation thanks to new technologies and
widespread move towards digital transformation solution. By keeping up with fintech trends,
financial services companies can stay relevant on the market and start innovating their prod-
ucts to gain a competitive advantage. As fintech startups launch their incredibly popular prod-
ucts, banks need to build new features that improve the experience of users.

In the future, it’s expected to see many more ecosystems of integrated offerings, and many
fintech companies may not feel like the “small startups” we have grown accustomed to. This,
however, will take time, and will be represented in various models.

Impact on Economy Growth

Fintech is part of the digital economy that has produced innovations that have transformed the way we
live, even as productivity growth has been slowing across advanced economies for decades.

Fintech has the potential to increase economic growth in emerging countries as well as major economies
through improving capital allocation and increasing efficiency. Since financial intermediation plays an
essential role in economies, technological progress in this area may well generate the sort of returns that
have proved more elusive with other digital inventions. Fintech could be the digital-era innovation to help
raise economic growth.

Fintech in Supporting National GDP

The Institute for Development of Economics and Finance (INDEF) predicts the P2P lending business to
contribute 100 trillion Rupiah to Indonesia's GDP in 2020. This year it contributes to around 60 trillion
Rupiah. The value has increased nearly four times compared to last year. There are two main driving
factors, ease of transaction and financial literacy. With a digital approach, the loan application process has
shifted easier. The platform can also connect lenders from personal and organizational circles. INDEF also
highlights there’s an increase in financial literacy index from 29.07% in 2016 to 38.03% this year.
PART 5

CLOSING
REMARKS
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In some parts of the country, fintech ecosystem begins to be associated with

our daily activities. Lending and payment are the most familiar elements, but
further education is needed to introduce the technology nationwide, including
proper connectivity. The emergence of fintech is expected to be a solution for
financial inclusion.

This year, OJK and BI apply stricter policy for registration and license to help
creating a better ecosystem to minimize bad practice and data abuse. BI also
initiate breakthrough by introducing QRIS, QR Indonesia Standard, a unification
of mobile payment practice that will be in effect early next year.

In the industry, the recent addition of OVO into unicorn status and some lend-
ing startups with high valuation is a validation that fintech has helped propelling
the growth of many sectors. An INDEF study claims fintech implementation has
contributed to the growing number of the nation's GDP year-to-year.

Nevertheless, we look forward to the emergence of other sub sector in the

industry, including investment, insurance, and remittance, as a catalyst to create
digital nation.