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Fintech expands retail investment among young Indonesians
The number of investors in equities, mutual funds and bonds increased 36.6 percent to 3.4 million in less than a year. Almost half of the investors joined through fintech platforms and were below the age of 30.
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Illustration of fintech. (Shutterstock/File)
F
intech platforms are projected to aid the surge in the number of Indonesia’s retail investors in the future, particularly as the younger generation is tapping into investment amid the COVID-19 crisis, the Indonesian Central Securities Depository (KSEI) has said.
KSEI data show that the number of investors in equities, mutual funds and bonds increased 36.6 percent year-to-date (ytd) from December last year to 3.4 million as of October this year, of which the majority are individual investors. Almost half of the investors joined through fintech platforms and 48 percent were below the age of 30, according to the data.
“This is an incredible prospect. We can expect the number to go up over the next 15 years as Indonesia is forecast to have a demographic bonus,” KSEI director Uriep Budi said in a webinar hosted by the Indonesian Fintech Association (Aftech) on Nov. 20.
Uriep was referring to a touted period when the country’s productive population, from age 15 to 64, outnumbers its nonproductive population, below 16 and over 64. Indonesia’s working age population is expected to reach 70 percent of the total population by 2030.
He went on to say that fintech platforms were also useful in handling more frequent but smaller investments, which he projected as the trend for the foreseeable future.
The number of retail investors has increased during the pandemic, which has driven millions into unemployment and made many nervous about their future income. Experts have also cited the large-scale social restrictions (PSBB) that force people to stay at home as part of the push factor of the retail investor boom.
Previous KSEI data show that young people are the fastest growing investor group. The number of investors aged 18 to 25 grew 338.61 percent from 2016 to May 2020, while the number of investors aged 26 to 30 grew 204.97 percent.
