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Digital payments boost financial inclusion in 2019
As much as 82.7 percent of Indonesians are aware of e-wallet platforms, while 62.4 percent are aware of digital investment and 56.7 percent are aware of pay-later services, according to the study, which involved 1,500 respondents nationwide.
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Cashless society, e-wallet concept. Man hand holding a smartphone, using mobile application to pay for his drink at the cashier. (Shutterstock/NATA FUANGKAEW)
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igital payment platforms helped boost financial inclusion in 2019 by giving more Indonesians access to financial services despite being criticized for unsustainable “burning money” business practices.
Digital payments, which include cashless transactions from cards, account-to-account transfers and e-wallets, have reached an inflection point in Southeast Asia as they are expected to reach US$600 billion in gross transaction value (GTV) this year, according to a recent study.
The compound annual growth rate (CAGR) is expected at 10 percent to reach $1.1 trillion by 2025, according to the e-Conomy SEA 2019 study by Google, Temasek and Bain & Company. Accounting for just over $22 billion in 2019, e-wallets are likely to grow more than fivefold and to exceed $114 billion by 2025, the study states.
“Digital technology is the enabler of [wider] financial inclusion. As more and more people use smartphones and digital payment systems, it has the potential to be the game-changer for Indonesia,” National Committee for Financial Inclusion (DNKI) project management head Djauhari Sitorus said on Nov. 14.
Digital payment is the most popular type among fintech platforms, according to Fintech Report 2019 published by state-owned PT Bank Rakyat Indonesia (BRI) and conducted by DS Research in November.
As much as 82.7 percent of Indonesians are aware of e-wallet platforms, while 62.4 percent are aware of digital investment and 56.7 percent are aware of pay-later services, according to the study, which involved 1,500 respondents nationwide.
The study is largely in line with India-based management consultancy Redseer’s projection that the country’s e-wallet market was set to be the fastest-growing fintech segment in the country, growing from $1.5 billion in 2018 to $25 billion in 2023.
