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A comprehensive overview of the cards, payments and consumer banking market in Indonesia, with clearsighted commentary backed by historic and forecast data.
Card volumes decreased markedly in Indonesia during 2020 due to Covid-19, although debit cards surpassed a meaningful milestone in the year: 200 million cards in issue.
However, debit cards are rarely used for purchases and credit card ownership levels remain low.
The Indonesian authorities have been making a concerted effort to modernise the point of sale, with merchant service charges for off-us transactions reduced and a new common QR code standard introduced.
In addition, the central bank has relaxed rules on credit cards to boost cashless transactions.
How the mobile phone is becoming pivotal for payments.
The culture of Indonesian lending in a changing world.
What cashless initiatives mean.
Why Indonesian credit cards are stagnant.
How the affluent segment is growing in importance.
TABLE OF CONTENTS
Demographics and the economy
Key retail banks and issuers
Acquiring and processing
Regulatory and other cards market information
Appendices: Card Payments Data
Appendix I: Demographics and the economy
Appendix II: Payments environment
Appendix III: Cards market data
Appendix IV: Mobile payments
Appendix V: Profit pool
Appendix VI: Card networks
Appendix VII: Key retail banks and issuers
Appendix VIII: Acquirers and processing
Appendix IX: Online acquiring data
Demographics and Economy
Around 55% of Indonesia's population reside in urban areas such as the capital Jakarta, Surabaya and Bandung, reflecting the importance of the industrial and tertiary sectors, each of which accounts for over 40% of GDP.
Indonesia is one of Asia's most exciting and attractive markets for digital payments, with an estimated 92% of its adult population owning a mobile phone.
Total billed volume made on payment cards (including credit and debit cards) reached $47 billion in 2019, an increase of 54% over 2014.
Indonesia had 41 active e-wallets in the first half of 2020. The leading offerings are integrated into other ecosystems, whether by teaming up with offline merchants or establishing exclusive partnerships with companies that have a large user base.
Credit cards remain a profitable business for issuers in this market, with an estimated pre-tax profit of $746 million in 2019, a 14% increase over the previous year. Profit per card stood at $43 during the same period but is forecast to decrease during the forecast period.
There were about 17.5 million credit cards in circulation at the end of 2019, representing a penetration rate of just nine credit cards per 100 adults. The number of debit cards increased by 14.4% to reach 174.4 million in 2019. They are forecast to surpass the 225 million mark in 2021.
Key Retail Banks and Issuers
The banking environment in Indonesia is complex: various government initiatives for financial inclusion exist alongside Islamic banking products, rural banks, retail banks and fintech products – all competing to serve 269 million people.
Acquiring and Processing
With an estimated four POS terminals per 1,000 people at the end of 2019, Indonesia remains in want of an adequate card acceptance infrastructure.
The retail e-commerce market in Indonesia amounted to $21.5 billion in 2019 and is forecast to reach $31.2 billion in 2020.
Regulatory and Markets Information
In 2020, Bank Indonesia (BI) capped fees for payments using QR codes and established standards to ensure interoperability. Consumers who use just one payment system can conduct transactions with other systems as well, rather than having to maintain multiple accounts.
Artajasa Pembayaran Elektronis
Bank Central Asia
Bank Ekonomi Raharja
Bank Negara Indonesia
Bank of China
Bank Rakyat Indonesia
Bank Tabungan Negara
Daya Network Lestari
Financial Service Authority
Financial Services Sector Master Plan
Gerbang Pembayaran Nasional
Indonesia Payment Systems Blueprint 2025
Indonesian Standard QR Code
Integrated Payment Interface
KB Kookmin Bank.
National Financial Inclusion Strategy
National Non-Cash Movement
National Payment Gateway
Otoritas Jasa Keuangan
PT Alto Network
PT Artajasa Pembayaran Elektronis
PT Jalin Pembayaran Nusantara
PT Penyelengara Transaksi Elektronis Nasional
PT Rintis Sejahtera
Sigma Cipta Caraka
Sinar Mas Land
Reports include detailed market and competitor intelligence on payments cards, e-money, acquiring, retail banking, and consumer credit in the Asia Pacific region. Analysts use primary and secondary source data and conduct in-depth interviews with senior industry executives and finance experts.
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