INDONESIA’S MULTIFINANCE INDUSTRY EXPECTED TO HELP FILL FINANCING GAP

Metropolitan Jakarta - Capital City of Indonesia

INDONESIA’S MULTIFINANCE INDUSTRY EXPECTED TO HELP FILL FINANCING GAP - A new Covid-19 Response Report (CRR), produced by Oxford Business Group (OBG) in partnership with FIFGroup, explores the opportunities for growth in Indonesia’s multifinance industry in the post pandemic era. The analysis focuses on the potential for accelerated digitalisation to reshape the segment, with the development of financial technology, wider digital lending and increased e commerce activity as emerging trends.

The CRR provides an in-depth analysis of Indonesia’s response to the pandemic and the potential for national recovery in an easy-to-navigate and accessible format, focusing on key data and infographics to illustrate the country’s socio-economic landscape.

The report highlights the role that Indonesia’s Digital Finance Innovation Roadmap and Action Plan 2020-24, launched by the Financial Services Authority (OJK), could play in helping multifinance players utilise the broad range of emerging technologies to attract new customers and, in turn, increase financial inclusion.

The CRR tracks consumer confidence levels in Indonesia following the arrival of the virus, and also explores the potential impact of consumer sentiment on the market. As attention turns towards the ‘new normal’ period and consumers look set to sustain increased e-commerce activity, the report presents the multifinance opportunity in online retailing – namely, ‘buy now, pay later’ schemes.

The report details FIFGroup’s growth story, which mirrors the broader industry’s expansion, and outlines the steps taken by the company to maintain business continuity throughout the pandemic.

It includes a wide-ranging interview with Margono Tanuwijaya, FIFGroup’s CEO, in which he shares his thoughts on several topical issues. These include the impact of accelerated digitalisation on the future development of the multifinance industry, and the deployment of technological tools to reach new customers and mitigate lending risks.

“In the multifinance sector, digital adoption is required to modernise business processes and develop digital products and channels in order to reach a wider customer base,” he said. “This includes integrating digital platforms to leverage the existing digital ecosystem to establish a competitive advantage. These conditions will also bring new competitors from tech start-ups that diversify away from their core activities and into finance.”

Jade Currie, OBG’s Regional Editor for Asia, said that, having borne the brunt of previous global crises, Indonesia was in a stronger position when the Covid-19 pandemic took hold as a result of robust economic growth and low public debt, combined with improved health service provision.

“Indonesia’s economy is expected to expand by 6.1% in 2021, outperforming much of the G20,” she said. “With the pandemic having accelerated many digital trends and changing consumer behaviour, we expect the country’s multifinance segment to expand its role in the industry’s ecosystem – not only by lending to businesses, but also by filling the financing gap.”

This Indonesia-focused CRR forms part of a series of tailored reports that the global research and advisory company is currently producing in conjunction with its partners, alongside other highly relevant, go-to research tools, including a range of country-specific Covid-19 Economic Impact Assessment articles and interviews.

The CRR is now available to view and download at: https://oxfordbusinessgroup.com/blog/jade-currie/focus-reports/report-will-covid-19-pandemic-reshape-indonesia-s-multifinance

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