The presence of financial technology (fintech) companies can encourage the acceleration of financial inclusion in Indonesia, chairman of the Supervisory Board of the Indonesian Fintech Association (Aftech), Rudiantara, has said.
“Financial inclusion means ensuring that Indonesian people have access to financial services, whether it is saving, lending, or investment,” he expounded at the opening of an Aftech workshop, ‘Fintech for Faster Economic Recovery’, here on Friday.
According to Bank Indonesia (BI) statistics, the number of e-Money instruments in Indonesia reached 513,968,693 in August 2021, he noted.
During the same period, fintech accumulation in lending reached Rp249 trillion with the number of loan recipients touching 68.41 million, he said citing data from the Financial Services Authority (OJK).
In recent years, the tech industry has continued to grow. This can be seen from the number of startup technology companies that are registered as Aftech members, he said.
The number increased from 24 to 275 by 2019 end and further shot up to 335 at the end of the second quarter of this year, he informed.
In addition to conducive regulations, the rapid growth of the tech industry has been influenced by several factors, such as increasing investment, a high percentage of the population belonging to the working-age group, and a high number of people—both unbanked and underbanked—who had never utilized any banking services, he said.
“Internet penetration has helped bolster the development of technology in Indonesia. We know there are 200 million more Indonesians who have access to the Internet,” Rudiantara said.
However, he argued, the technology industry also faces some challenges such as low financial literacy, basic infrastructure, and limited resources, especially in non-metropolitan areas.
He also emphasized that financial literacy must be improved so that people as fintech users become more literate and do not get trapped in illegal online lending, or popularly known as pinjol.
“Illegal pinjol is so popular that even the President conveyed his concerns about it,” he highlighted.
However, he reminded that people’s perception of financial technology should not only be limited to illegal online lending.
In fact, the technology available in the market is varied, not only in terms of online payments and loans but also in the form of other business models such as aggregators, innovative credit scoring, financial planners, equity crowdfunding, and wealth management services, he expounded.
Aftech, as an association that gives support to tech companies, takes the problem of illegal online loans seriously and does not want to stay silent, he affirmed.
“Aftech has taken various steps and is committed to keep working to tackle pinjol, including collaborative steps with regulators and stakeholders,” he said.
Source: Antara News