Southeast Asia is one of the fastest-growing global fintech markets, outpacing the UK, the US and China. Driving this growth is the historical lack of financial inclusion. Access to the formal financial system in Indonesia is low, although improving quickly. According to Statista, based on Indonesia’s large population and low banking access rate, the unbanked population remains the 9th largest worldwide. Just less than half (49%) of all Indonesians have access to traditional bank accounts. Globally, 31% of adults are unbanked.
This banking void creates a remarkable opportunity for fintech companies to offer innovative solutions.
Fintech in Indonesia
About half of Indonesia’s population actively uses the internet, so about 150 million people can access fintech. Like the other countries in Southeast Asia, Indonesia’s unbanked population is turning to fintech for greater ease of everyday financial transactions. The most disruptive fintech sectors in Indonesia are payments and lending. Fintech radically changes how individuals and organisations make payments, save money, invest, borrow, and buy insurance.
Loan agreements In Indonesia on peer-to-peer platforms are regulated. The Information Technology-Based Money Lending Services requires that two agreements appear in every P2P scheme between:
- Platform and lender
- Lender and borrower
As investors channel funding into the region, financial technologies are a prime investment. However, P2Ps have recently collected some negative press and adverse reputations due to the practices within P2Ps to promote growth over quality lending and the rise of outright illegal P2P lenders.
Large Securities Papers Auction Platforms
Large Securities Papers Auction Platforms (SPAPs) contribute to the economic growth of local Asian countries by supporting SMEs, leading to greater opportunities for people to work. The unique Indonesian ecosystem of fintech products is designed and explicitly developed around an innovative auction platform.
The online platform connects Sellers to Buyers of Securities Papers, hosting a Fair-Price Mechanism through a competitive online bidding process. This fintech synergy lays the groundwork for the financial world. Fast backing for the Seller for working capital and a reliable investment for Buyers.
Fintech SPAPs make it easier for SMEs to access resources and working capital to keep their business running. SPAPs specifically offer a more robust legal framework, stronger risk management procedures, and more highly-regulated processes when compared to P2P counterparts.
Indonesia’s Securities Papers Auction Platforms (SPAPs) drive continuous innovation in the fintech sector.
