Fintech startups in Indonesia have initiated a revolution the way financial institutions including banks in the country work. The fintech landscape of Indonesia has more or less followed the trajectory of the revolution India witnessed last year.
India, November 2016. PM Modi launched a demonetisation drive to eradicate black money, fostering a new wave of digitisation in India. Consequently, there was a tremendous rise in the adoption of e-wallets, launch of new fintech startups, and the average Indian became familiar with a new financial entity, bitcoin. With huge sums being invested in the segment, Fintech became the frontrunner of the Indian startup ecosystem.
From local grocery shops to petrol pumps to movie theatres, digital wallets have captured each and every day-to-day business which requires payments. Not only this, digital wallets have even seen a massive adoption for payment chores like booking air tickets or buying movie tickets or paying bills (DTH, Water, Electricity). In a nutshell, India is poised towards fintech revolution – thanks to the rise of digital wallets, UPI coming into the picture and of course, companies launching payment banks.
This is what fintech does: it disrupts the traditional and welcomes the future. It’s not just about innovation and technology, it is also about financial inclusivity, and India is moving towards that.
Coming to Indonesia, there are more than 150 fintech startups in Indonesia and this number has increased by a whopping 78% from 2015, according to the Indonesia Fintech report 2016. Quite similar to the India story, not in context to numbers but the growth percentage. India recorded $1.77 Bn in FinTech investments between 2014 and 2015 through a total of 158 deals, according to Inc42’s FinTech Market Report 2014-2016. The average deal size was $9.82 Mn.
All of this has happened in the last couple years. So when we ask ourselves how? The answer is simple: when technology meets innovation, disruption happens.
The Present Indonesian Financial Ecosystem
With a population of more than 250 Mn and a consistent growth in the annual gross domestic product (GDP), Indonesia has emerged as Southeast Asia’s trojan horse, as the next big land of opportunity.