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mid the burgeoning growth of e-commerce in Indonesia, new digital payment services and methods are struggling to penetrate a market still dominated by cash, according to financial technology experts.

Online payment gateway provider VeriTrans CEO Ryu Suliawan said that Indonesian online shoppers still preferred to pay for their online transactions with cash on delivery.

Ryu attributed the low popularity of online payments to the failure of many e-commerce merchants to offer digital payment options.

He stressed that change would have to be effected by online e-commerce merchants themselves, as they are ultimately the ones who utilize payment services such as VeriTrans and Bitcoin in their transactions.

'€œIt shows the need for industry and regulators to present opportunities for alternative payment systems. Only then will they flourish,'€ Ryu said on the sidelines of the two-day TechinAsia conference in Jakarta on Wednesday.

With more encouragement from merchants, he said, more people would be made aware of the system, which would lead to increased usage.

VeriTrans is a service that utilizes various digital payment methods such as direct debit, card payments and e-wallets, partnering with a number of banks including Bank Mandiri, BCA, CIMB Niaga and BNI. At present, 850 online merchants have implemented the VeriTrans method in their sales.

Expressing a similar view, digital payment Bitcoin Indonesia head Oscar Darmawan said Bitcoin was still relatively unknown among mainstream Indonesian consumers, although he also claimed that Bitcoin user numbers in Indonesia were growing by between 100 and 200 new users a day.

According to Oscar, the payment method, using so-called cryptocurrency, may appeal to those who have no credit cards or bank account but want to make online payments.

'€œAlmost all of Indonesia'€™s Bitcoin users are those included in the '€˜unbankable'€™ segment, meaning they do not, or choose not to, have bank accounts. Bitcoin for them is a simple alternative to conduct their transactions online and could be used in a more widespread way if the concept were promoted and potential users educated,'€ Oscar said.

Around 40 percent of Bitcoin'€™s 80,000 Indonesian users were active users, he said, adding that the average Bitcoin transaction was less than Rp 200,000 (US$14.66).

At the end of last year, e-commerce transactions in Southeast Asia'€™s largest economy reached $12 billion, a significant increase from the $8 billion posted in 2013. The Indonesian E-Commerce Association (idEA) expects the market to be worth Rp 295 trillion by 2016.