The fintech ecosystem for Indonesia, in particular, seems to have reached a booming new phase. Singapore Fintech News, a media outlet, sent out a report showing that the country boasts a minimum of 322 fintech companies. The report showed that 125 of these fintech companies are, in fact, unlicensed but registered online lending service providers.
Startups Spread Across Many Sectors
Now, subtracting the unlicensed lenders, leaving 197 fintech firms left, 73 of them are battling it out within the payments services arena, with nine of them are in the crowdfunding space. Another 33 of these fintechs offer lending services and are indeed licensed, with 15 others standing as insurtech firms. A brave 24 firms are prioritizing the investment world, with 26 working with blockchain technology. Lastly, seven firms are in the price comparison and point-of-sale service sectors, each.
Fintech News Singapore gave a lot of positive words about this booming fintech industry, claiming that it had a path of success set out for it thanks to the proactive government of Indonesia. This government has introduced various rules and legislation when it comes to digital payments, peer-to-peer (P2P) lending, as well as open banking, which is its most recent addition. This was all done by the country’s government to try and improve financial inclusion while encouraging innovation.
International Players Taking Notice
The country’s proactive approach seems to be working out for Indonesia, as a number of heavyweight investors have been attracted to the growing fintech industry of the country. Indonesia has seen a large number of global investment giants entering joint ventures in the country, China’s Ant Group included.
Prime examples of these new ventures would be Tencent, the owner of WeChat, investing within GoPay’s operator, GoJek. GoPay stands as the largest e-wallet firm in Indonesia. OnlinePajak, a tax compliance solution provider, had the US private equity firm, Warburg Pincus, lead a Series B funding round worth $25 million in total.
A Country Prime For Growth
The fintech space for the country is apparently gearing towards even greater growth. As it stands now, Indonesia boasts the world’s 16th-largest economy, and is the fourth-most popular country on Earth, boasting a population of 274 million. Another key factor is the age of the population, as 84% of the country’s residents are under 54. What this means is the population could see even higher levels of growth.
It should be noted that many of these fintech startups are only in their earlier stages, but the market is witnessing later-stage startups increase dramatically. The report itself showed that there was there were already a number of merger and acquisition (M&A) and consolidation deals done across just two years.