The rapid changes and developments in technology, as well as the digital transformation in Indonesia and abroad, have given rise to many innovations, one of which is in the financial aspect through various digital payment methods. This rapid change has created a high demand in society for secure, fast, efficient, and inclusive payment methods, ultimately forcing business owners to adapt and provide various forms of digital payment methods that are gradually replacing traditional cash payments. The COVID-19 pandemic in 2020 was also a contributing factor that accelerated the transition process of existing payment methods, where business players had to adapt to digital payment methods due to government policies aimed at reducing physical contact by prioritizing cashless payments.
According to data from Bank Indonesia, there has been an increase in the number of digital transactions in Indonesia. One indicator is the data on the use of electronic money. In 2018, the value of electronic money usage was only IDR 106.78 trillion, while in 2019, it increased to IDR 473 trillion and further to IDR 504.9 trillion in 2020. In 2022, the transactions involving electronic money reached IDR 1,177.8 trillion. From the existing data, we can conclude that an increasing number of Indonesian individuals and businesses have adopted digital payment methods in their activities.
What is Digital Payment?
Digital payment can be defined as a form of payment system conducted through digital or online modes, without involving the exchange of physical cash. The transactions typically involve transferring a certain amount of money from one account to another through a specific application, and the process involves digital devices such as mobile phones, computers, credit cards, debit cards, or electronic data capture (EDC) machines.
As per data reported by Statista, Indonesia is the fourth-largest country in the world in terms of smartphone users, with approximately 190 million smartphone users, which is one of the reasons why the use of digital payment in the country continues to rise. This also makes digital payments more easily accessible to the Indonesian population in various locations around the world.
What are the most popular digital payment methods in Indonesia?
Some of you might be wondering, what digital payment methods are popular among Indonesians? At least there are several examples of popular or widely used digital payment methods in Indonesia, including:
Debit Cards
Debit cards, often referred to as bank cards, are payment cards usually issued by banks and are typically directly linked to the balance in your bank account. Debit cards can be used for payments and also to withdraw funds from your bank account through ATMs. In digital payments, payments with debit cards are usually made through Electronic Data Capture (EDC) machines. To obtain an EDC machine, a business usually needs to register with a specific bank.
Credit Cards
Similar to debit cards, credit cards are payment cards issued by banks or other financial institutions. Unlike debit cards, this popular digital payment method is not linked to a specific account but is a form of credit provided by the bank or financial institution, resulting in an obligation for users to settle bills and other administrative fees periodically issued. In digital payment methods, payments with credit cards are also typically processed through EDC machines issued by specific banks or financial institutions.
Mobile Banking
Mobile Banking is the most common and popular digital payment method in Indonesia, where buyers can transfer money within the same bank or across different banks through smartphone applications developed or issued by each bank. Moreover, through these applications, users can also make daily bill payments, ranging from utilities bills to purchasing mobile credit.
E-Wallet
With the development of technology and the banking industry in Indonesia, there is an increasing number of digital wallets or e-wallet providers in the country. This supports e-wallets as a new trend in digital payments in Indonesia. Through e-wallet applications such as Gopay, OVO, Dana, and others, users can store money in their e-wallet app and use it for various payments. Additionally, to attract users, many e-wallet providers collaborate with various merchants both domestically and internationally, offering cashback or discounts for users in every transaction.
QRIS
QRIS, an abbreviation for Quick Response Code Standard, aims to unify various digital payments organized by various Payment System Service Providers (including e-wallet providers/digital wallets) using QR codes. This payment system was introduced by Bank Indonesia at the end of 2019. Since January 1, 2020, all payment service providers have been required to adopt QRIS as part of the Vision for the Indonesian Payment System 2025.
Currently, QRIS has become a popular choice for many people for digital payment methods because it accommodates interbank payments and digital wallet platforms. Its easy application without requiring businesses to have Electronic Data Capture (EDC) machines makes QRIS one of the inclusive digital payment methods. The implementation of QRIS is expected to assist businesses in Indonesia, especially for micro, small, and medium enterprises (MSMEs).
Benefits of Digital Payments for Businesses and MSMEs
As a business owner and participant in Micro, Small, and Medium Enterprises (MSMEs), you might wonder if your business needs to offer digital payment options to your customers. Here are several reasons to consider before deciding to implement a digital payment system for your business:
Convenience
By adopting digital payment methods, your business transactions can be processed quickly, and all transactions are well-documented. For those with retail businesses, embracing digital payments eliminates the need to deal with providing change and also speeds up employee shift turnovers.
Well-documented Financial Transactions
One advantage of digital payments over cash transactions is that all transactions are recorded systematically through the existing system. This saves time and effort for your financial department employees by reducing the need for manual record-keeping checks. Digital payments also enable business owners to monitor cash flow and transactions in real-time, allowing for quicker financial analysis and decision-making without waiting for reports.
Broader Market Reach
If you have an online business or are considering marketing your MSME online, adopting digital payment methods allows your business to reach consumers from various regions in Indonesia.
Enhanced Security
Another advantage of digital payments is the enhanced security system. This is possible because all transactions are recorded and can be monitored in real-time, reducing the risk of fraud and embezzlement. Moreover, digital payments usually come with robust verification systems, minimizing the possibility of misuse by other parties.
Aspire Payment Gateway as your trusted partner in growing your business
As a partner in growing your business, Aspire also offers a payment gateway service to support the digitization of your enterprise. The digital payment system provided by Aspire allows you to receive payments digitally through various payment methods with transparent and competitive MDR and transaction fees. This can help your business reach more clients from various regions in Indonesia. The digital payment methods offered by the Aspire payment gateway include Credit Cards, Transfers to Virtual Accounts, various e-wallets, QRIS, and various other digital payment options. Interested in learning more about how the Aspire payment gateway can be a solution for growing your business? Learn more about the Aspire payment gateway here.
Frequently Asked Questions
How can Aspire support the unique financial needs and challenges of mid-sized businesses?
Aspire offers a comprehensive suite of expense management solutions tailored for mid-market companies. This includes sophisticated corporate cards, advanced budget controls, and streamlined claims and approval policies, all designed to enhance financial efficiency.
How quickly can a mid-market company integrate Aspire's solutions into existing systems and workflows?
Integration with Aspire's expense management solutions is swift and seamless. Mid-market companies can swiftly implement corporate cards with tailored features, set up nuanced budgets, and establish streamlined claims and approval processes, ensuring minimal disruption to existing workflows.
How does Aspire compare to competitors for international money transfers?
Aspire excels in international expense management with FX fees up to 2x cheaper than traditional banks.
Global payments are offered by various providers through business accounts. Read our article to know more about types of business accounts and how to choose the best one for your business. There are many banks and fintech companies offering business accounts to businesses in Singapore. We have covered them all in our blog, you can click the links to view accounts offered by various banks such as DBS, OCBC, Maybank etc.
However, if you are a start-up or a growing business, chances are you may not meet the eligibility criteria for most of these banks or find their charges to be expensive for your liking. You can consider opting for Aspire multi-currency account for global payments which offers you all the benefits, with eligibility criteria which are less stringent. Read our article on bank charges in Singapore for a quick and easy comparison.
What level of customization does Aspire offer to meet the specific financial requirements of mid-market clients?
Aspire understands the diverse financial needs of mid-market clients and provides a high level of customization to tailor solutions accordingly. This includes the ability to customize corporate cards with specific spending limits, rewards, and benefits that align with the unique requirements of each client.
Additionally, Aspire's budgeting features are adaptable to accommodate the distinct financial structures of mid-market enterprises. The platform also allows for fine-tuning approval policies, ensuring they align with the specific workflows and compliance standards of individual mid-market businesses. This commitment to customization empowers mid-market clients to optimize their expense management in a way that best suits their financial goals and operational preferences.
Is there a minimum balance required for Aspire Business Accounts?
No minimum balance is required to keep your SGD, USD, EUR, GBP and IDR Accounts activated.
Can Aspire's corporate cards be customized to cater to the specific needs of consulting teams on the go?
Yes, Aspire's corporate cards are highly customizable. Consulting teams can benefit from tailored spending limits, travel-centric perks, and real-time transaction tracking, ensuring that the cards meet the unique requirements of professionals on the move.
How does Aspire support budget management for consulting projects and travel expenses?
Aspire's platform offers sophisticated budget controls that consulting companies can adapt to project-specific needs. This includes setting project budgets, tracking expenditures, and receiving real-time insights to ensure that expenses align with project goals.
What are Aspire Corporate Card FX rates?
At Aspire, we want you to pay the lowest rates in the market.
- Zero card activation fees
- Zero card transaction fees
- Best FX rates, up to 2x cheaper than banks
How does Aspire help consulting companies enforce expense policies and approvals for travel expenses?
Aspire streamlines the claims and approval process, allowing consulting companies to establish and enforce expense policies seamlessly. Customizable approval workflows ensure compliance with company policies and industry regulations.
Is Aspire's platform scalable for consulting companies of varying sizes?
Yes, Aspire's platform is scalable and caters to consulting companies of all sizes. Whether you're a boutique consultancy or a larger firm, the platform's features can be adapted to meet your specific travel and expense management needs.
How can I open a business account in Singapore?
For a business account in Singapore, Aspire is an excellent choice. With a focus on startup and SME needs, Aspire offers a seamless and transparent banking experience.
Benefit from their user-friendly online platform, no minimum balance or account opening fees, and dedicated support for businesses of all sizes.
Aspire is designed to streamline your financial management, making it an ideal partner for entrepreneurs in Singapore.
How long does it take to open an Aspire business account?
Registration with Aspire takes less than 10 minutes which you can do via our website or mobile app.
Once registered, we will get back to you within 5 business days on whether your account has been activated or if we need further documents from you.
Our account verification process varies according to the nature of your business. In exceptional cases, it can take up to 7 days to process your documents.
How can Aspire's corporate cards benefit my startup?
Aspire's corporate cards offer a range of benefits for your startup. Earn 1% unlimited cashback on qualified spends, simplify expense management, enjoy streamlined transactions, and gain real-time insights into spending. With customizable limits, integration with accounting software, and enhanced security features, Aspire's corporate cards are designed to empower your startup's financial efficiency and provide added convenience for your team.
Is Aspire suitable for both early-stage and established startups?
Absolutely, Aspire caters to the needs of both early-stage and established startups. Whether you're just beginning your entrepreneurial journey or have an established business, Aspire offers tailored financial solutions to help streamline your operations.
From managing expenses and optimizing workflows to providing valuable financial insights, Aspire's platform is designed to adapt and scale with your business as it grows. The flexibility and scalability of Aspire make it a suitable choice for startups at various stages of development.
Is there a minimum balance required for Aspire Business Accounts?
No minimum balance is required to keep your SGD, USD and IDR* Accounts activated.
However, we recommend keeping your subscription plan amount available on your balance to ensure you're up to date with your payment every month.*
To create a recipient or make any transaction on your IDR Account, you'll need to have a minimum balance of IDR 10,000 on your account.
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