For entrepreneurs and start-ups, fintech is a jewel in the desert, offering a wide variety of services ranging from crowdsourcing to mobile payments that help them set up and expand their businesses in more efficient ways.

A decade ago, there were around 850 fintech companies in the world, and today the number has soared to up to 3,100. Fintech investments, specifically in the Asia-Pacific region, skyrocketed from about US$880 million throughout 2014 to nearly $3.5 billion in just the first nine months of 2015.

Last year, global fintech investments rose 75 percent to $22 billion. The Asia-Pacific region saw growth more than quadruple to $4.3 billion, coming mostly from China ($1.97 billion) and India ($1.65 billion). These investments mean that startups with the most potential have more access to funding that will help them bring their solutions to a wider market.

Data from the Indonesian FinTech Association shows at least 157 fintech start-ups are currently operating in the country. The firms have collectively managed more than $18 billion in transaction value. The numbers are likely to grow in line with the large size of untapped market in Indonesia, home to over 250 million people.

The Indonesian government has been particularly encouraging banks and non-bank institutions to team up with their fintech counterparts in the country.

Fintech companies are agile and can move quickly from ideation to launch. They are switched on to the idea of innovating change in the digital world by bringing culture and capability together.

We all know that fintech companies and start-ups have innovation in their DNA. They are set up from the beginning to disrupt conventional services and to deliver new services to market quickly. On the other hand, major conventional organizations have powerful brands, distribution, deep balance sheets, large customer bases, licenses to operate and many other powerful assets to prosper in any environment.

With today’s unstoppable technological development, fintech is expected to enter the fray through partnerships with various companies, financial institutions and government institutions to create the ultimate financial solution. To make these innovations possible, we recognize that collaboration among stakeholders are key.

Like building a house, we cannot make every material from scratch. It will be faster and cheaper to use material built elsewhere.

As regards financial solutions, Application Programming Interfaces (APIs) will make it possible for stakeholders to collaborate, plug into and build off others’ innovations. APIs allow players to choose one building block to focus on and connect with others to create the bigger picture. Or, they could build an entire focus on the bigger picture and connect with others to create it.

According to Accenture, 71 percent of organizations expect partner APIs to be broadly adopted across their industries by this year. But while they will be transformative, APIs are just a platform. The value will lie in the quality of the building blocks once they come together. In this sense, we all need to get good at “solutioning” — recognizing the opportunity, challenge or insight, and pulling different APIs or other capabilities together to design solutions that meet the end goal.

APIs are quickly becoming the standard by which companies exchange data and build the smart, seamless, omni-channel experiences that customers want. With this in mind, the fintech industry no doubt will be prospering in the next few decades.

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The writer is Indonesian FinTech Association member and PT Visa Worldwide Indonesia president director.

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