At a certain juncture, fintech and banking compete for the same market targets. However, when they collaborate, it presents an opportunity to enhance financial inclusion, particularly for the unbanked population.
What’s New
A collaboration between banks and fintech is expected to expand the reach of financial services to the public. The significant growth of P2P lending indicates the rapid development of fintech and its potential competition with the banking industry. OJK records show a growth of 18.05% YoY in P2P lending to Rp 59.38 trillion until October 2023, while banking credit growth reached only 9.74% to Rp 6.966 trillion until November 2023.
Behind The News
Banks and fintech P2P lending are competing in financing distribution. Collaboration between banks and fintech is seen as a solution to leverage the advantages of both business models and reach segments of the population that are currently unbankable.
Why It Matters
The collaboration between banks and fintech allows for more inclusive and widespread financial services. The rapid growth of fintech, especially P2P lending, indicates a paradigm shift in accessing financial services and encourages the banking industry to innovate.
What We Are Thinking
The collaboration between banks and fintech holds promise for more inclusive economic growth. Balancing competition and cooperation will be key to maximizing the benefits of both industries for the public and the economy as a whole.
