Payment trends have escalated from offline to online systems. As one of the largest internet users in the world, Indonesia has adapted to online payment for various transaction scales, including daily payment, monthly invoices, business transactions, government administration, and so on.
Payment methods in Indonesia also vary according to customer’s needs and behavior. Each business has to analyze which payment method suits their customers including matching them with the current trends. Get to know more about the Indonesian latest payment trends in this article.
About Online Payment
Overall payment in Indonesia has shifted gradually from offline to online, especially in the bigger cities. You might easily find QR payments printed in the food stalls or small stores to accept payment. It indicates that Indonesian customers prefer online payment over cash, over time.
Not only offline store payment, but online payment also applies to online shopping systems. Which makes it easier for customers to pay and the sellers will get notified. It allows even nonbanked people to pay cashless using e-money.
Online payment will grab younger customers more since the generation prefers easy and auto-recorded payments for their daily transactions. Furthermore, several payment channels also offer extra discounts or points which attract customers who value such benefits as part of their shopping experience or even a way of saving money.
The Indonesian government also intensified the usage of online payment by adapting online payment to their bureaucracy and creating supporting programs to leverage the usage of online payment for Indonesian citizens.
For instance, payment for public transportation, toll roads, public administration, and even applying electronic stamp duty (meterai elektronik) as part of mandatory requirements for government staff recruitment documents.
This is why the current payment trends in Indonesia are related to online payment. The current condition is supported by the reliable payments industry that develops its products continuously. You will get through deeper explanation of each payment in the section below.
Payment Trends in Indonesia
We will discuss more about online payment trends in Indonesia including what industry suits them and how customers perceive the payment to fulfill their needs. Do not hesitate to scroll this page to learn more.
1. QRIS
If we’re talking about Indonesian payment, QRIS is arguably the top of mind. QR Code Indonesian Standard or we called it QRIS (read: KRIS) is a QR payment standardization developed by the payment system industry together with Bank Indonesia.
QRIS was launched in 2019 and effectively used in 2020 nationwide. A fun fact about this payment is that it was launched on the same day as Indonesian Independence Day on 17 August 2019.
This payment is officially used after going through several trials. This standardization means that all QR-based non-cash payment service providers are required to use the QRIS system as of 1 January 2020.
Generally, QRIS is divided into 2 types, static and dynamic QRIS. Static QRIS is a type of QRIS payment that is fixed, cannot be changed, and can only be owned by 1 merchant. You can print the Static QRIS file and install it in your offline store.
Dynamic QRIS is a one-time QR code generated by a specific invoice. So the code is only used for one invoice and the system will generate a new QR code for a different invoice. Both dynamic and static QRIS can be paid for by customers using mobile banking apps or e-wallets from their smartphones.
This type of payment is suitable for customers in general. Especially the ones who value practical and fast usage for their daily transactions. The general transaction for QRIS is IDR10.000.000, so please make sure that your invoice matches the required limit.
For bigger transaction amounts, you can request an upgrade limit to your payment provider (if possible) or divide the invoice into several different invoices. Usually, QRIS is used for smaller transactions, like FnB, daily fashion wear, and simple digital products for daily usage.
2. Virtual Account
Have you ever heard about virtual accounts? It is not a common payment trend overseas but is largely used in Indonesia. A virtual account in the payment industry is a type of payment method to pay your invoice through a series of unique numbers.
Because it is virtual, this account does not have a regular bank account number as we often find. Business owners just need to send customers the virtual account (VA) number according to their invoices instead of sending the business owner’s bank account details.
Yes, the customers do not have to type the destination account number. Instead, the customers will copy the virtual account number to their mobile banking app. Virtual accounts can be paid using bank account software like mobile banking or Internet banking.
There are 2 types of virtual accounts applied in Indonesia based on the Ministry of Finance (Kemenkeu), fixed virtual accounts and non-fixed virtual accounts. The major difference between these two is how the series of numbers is created.
Fixed virtual accounts are created by connecting them directly to each user’s cellphone number. Usually, the formula will be several digit numbers in the front + the customer’s cellphone number. The first several digit numbers are generally correlated with the merchant or business owner’s identification number.
Meanwhile, a non-fixed virtual account is only made specifically for one invoice. So, different invoices require different virtual account numbers. You don’t have to rush, because the payment system will generate them automatically.
Fixed virtual accounts are suitable for the type of business that potentially creates continuous orders and already has a systematic platform like a mobile app or desktop dashboard. For instance, online grocery apps, online taxies apps, and many other tech startup platforms for their customers.
Whereas, a non-fixed virtual account is a perfect match for more general business. You don’t have to create an advanced ecosystem to receive payment using a non-fixed virtual account since it will only created by available invoices.
Read more: Virtual Account: a Simple Payment Method for Your Business
3. e-Wallet
e-Wallet or digital wallet is an electronic service for storing payment instrument data, including cards and electronic money, which can accommodate funds for making payments. Data has shown that e-wallet is used more than conventional bank transfers in Indonesia.
So, e-wallet is part of the top payment trends in the country. This payment method usually comes in the form of mobile apps and is easy to use in everyday payment transactions. It can connect to various shopping platforms or even support the Apple payment ecosystem.
The main way to use e-wallet is by top-up your e-wallet balance via a selected funding source, for example, a bank account. After that, customers can finish their payment using e-wallet.
Furthermore, users can make payments using this technology. If the transaction is carried out directly at the store, it is generally carried out by the customer displaying the barcode or QR code of their e-wallet at the cashier, then the cashier will scan the code displayed. But, you can also scan QRIS using the e-wallet.
Digital wallets can attract customers who value convenience and various promotions. This payment usually offers cashback or discounts, especially in seasonal events. Digital also suits smaller amounts of transactions which supports small and medium-sized businesses.
Read more: Payment Gateway: A Simple Explanation of What It Is and How It Works
4. Credit Card
Credit card is largely used across the world. This type of payment might be easily found in many countries, including Indonesia. This type of payment is favorable to customers who value detailed data transactions, managing cash flow, and collecting points for interesting rewards.
In Indonesia, credit card payment is usually used for bigger amounts of transactions but is also chosen for daily transaction needs occasionally. Offline store payment using an EDC machine to accept payment on the spot.
The current fintech industry also supports accepting credit card payments via online systems. You can pay directly via payment links or connect your websites to credit card payment with payment gateway services.
This type of payment trend is compatible with business industries that require local and international payments. Make sure that the customer’s credit card supports overseas payment, for instance, issued Visa, Mastercard, or JCB that have authority to carry out international payment.
Your Go-to Local Payment Partner
Are you planning to build a business in Indonesia? Then, consider how the current payment trends become a strategic step to take. After getting a clearer understanding of Indonesian payment, it is also a smart move to find the best local payment partner.
iFortepay is an end-to-end payment service provider for your various business needs. We have licenses from Bank Indonesia and are supported by the largest ecosystem in the industry, Djarum Group. Connect your business with various payment channels through a payment gateway service in an integrated flow.
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