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Jakarta Post

Five fintech sectors expected to grow fast in next five years: Association

  • News Desk

    The Jakarta Post

Jakarta   /   Mon, November 26, 2018   /   11:25 am
Five fintech sectors expected to grow fast in next five years: Association An illustration of peer-to-peer lending that uses financial technology. (Shutterstock/File)

The executive chairman of the Indonesian Financial Technology Association (Aftech), Kuseryansyah, has estimated that five financial technology (fintech) sectors will experience significant growth in the country in the next five years.

These sectors are online payment, peer-to-peer (P2P) lending, insurance technology (insurtech), crowdfunding and price aggregators, he added, arguing that they would experience fast growth because their services could be accessed by 100 million smartphone users in the country.

“Look at Go-Pay and OVO, they’re already like a lifestyle,” he said recently, referring to two of Indonesia’s most popular online payments platforms.

P2P lending services have the second biggest potential for growth because they offer easily accessible small loans in a country where only 36 percent of the population is banked.

Financial Services Authority (OJK) data shows that P2P lenders had distributed Rp 11.7 trillion (US$805.29 million) as of the end of August, with the figure expected to increase to Rp 18 trillion in December.

Meanwhile, insurance technology, which uses big data to create more customized financial plans, may also see a rise in a country where only 1.7 percent of adults have an insurance program.

Kuserasyah said crowdfunding would also experience significant growth as the OJK was slated to release a crowdfunding regulation, which is expected to boost sales by improving consumer trust.

Lastly, he said that price aggregator services such as Cermati and Cekaja, which help consumers save money on e-commerce purchases, were also expected to rise in popularity as the domestic e-commerce market is predicted to grow to $65 billion by 2022. (nor/bbn)