As online shopping sites surged in Indonesia, so does electronic payment system that facilitates transactions between buyers and sellers in digital world.
INTERVIEW with an Online Shop Owner
This week I had a chance to have a conversation with an online shop owner in Bandung (Indonesia). I asked him about electronic payment system. He mentioned that some shops had accepted payment through Telkomsel T-Cash, however he still only accepted payment through fund transfer instead. Popular banks for fund transfer is BCA (in the city), Mandiri (further from the city), BNI and BRI (more further from the city).
BACKGROUND
Online banking in Indonesia is growing. One of the indicator of this matter is total unique visitors to online banking sites. Comscore, a leader in measuring digital world, researched this and the result is the visitation in Indonesia went up to 72% in a year, more than other countries in Asia (1).
Online Banking Category Visitation by Market (in millions) (1)
Local bank presence in Indonesia is considerably strong as two local banks came up in top three online banking destination. The top three were Mandiri, BNI, and Citigroup (1).
Online banking allows account holders to do financial transaction in digital world, such as bill payment and fund transfer, which facilitate online shopping. Another popular service is e-money. While most banks offer e-money in card format, Non Banks institutions such as telecommunication companies offer e-money to transfer fund between subscribers, such as T-Cash (Telkomsel), i-Vas (Telkom) and Dompetku (Indosat).
T-Cash has 5.3 million subscribers until first quarter 2011, grew from 4.7 million subscribers in the end of 2010, and targeted to have about 8 million subscribers or grow by about 70% in the end of 2011 (5).
T-Cash has 5.3 million subscribers until first quarter 2011, grew from 4.7 million subscribers in the end of 2010, and targeted to have about 8 million subscribers or grow by about 70% in the end of 2011 (5).
Indonesian Government introduced a regulation about fund transfer (2) to public on 3 May 2011 (3). According to this regulation, non-bank institutions that run financial transaction within the country have to be licensed (approved by The Government). Government officials said that the regulations was created to protect banks and customers and currently there were about 70 non-bank institutions that had the licenses (4).
FURTHER DEVELOPMENTS
The current electronic payment methods, through fund transfer via online banking or e-money, is still lack of security for both the buyer and the seller since both methods rely on trust between buyer and seller. There are possibility where the buyer doesn't pay what he order or the seller doesn't deliver what he offer.
These year, there are two other electronic payment that is expected to be launched:
These year, there are two other electronic payment that is expected to be launched:
1. KasPay (7)
Kaskus.us has buy - sell forum in its site. To facilitate its users, Kaskus Network will provide online payment service, KasPay. Kaskus is developing partnerships with banks, not only big banks, but also small banks to accomodate users' need. KasPay will facilitate payment, but the payment method still remains through credit card and ATM. It is expected to be finished by the end of this year.
2. KlikPay (6)
SUMMARY
As transaction in digital world becomes more demanding and no payment solutions has been well established, companies are trying to gain this momentum. Licenses to run financial transaction has been given to several companies, therefore customers will possibly be given numerous offers of electronic payment solution within this two years. Companies that have already had well-established IT system will surely be advantageous.
Sources:
1. Comscore: Online Banking on the Rise in Southeast Asia
2. Undang Undang tentang Transfer Dana
3. Sosialisasi Undang-Undang Nomor 3 Tahun 2011 tentang Transfer Dana
4. Indonesia Enacts Non-Bank Money Transfer Regulation
6. E-commerce di Indonesia: BCA akan Meluncurkan KlikPay, Bank Mandiri Siap dengan Tokone
7. Kaskus Akan Buka Layanan Logistik Barang
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