The Southeast Asian market is currently experiencing rapid growth, with an increasing number of cross-border sellers seeking new opportunities for business development in this region. As the fourth most populous country in the world and the largest economy in Southeast Asia, Indonesia has become a key market for cross-border sellers to focus on. In the connection between sellers and consumers, payment plays a crucial role in succeeding in the Indonesian market. With the growing variety of payment tools available, what are the current characteristics of the online payment market in Indonesia? And how should sellers choose the most suitable online payment methods?

Rapid Growth in Localized Payments: E-Wallets Are the Most Popular

With a population of 270 million, a high smartphone penetration rate, and supportive government policies for financial development, Indonesia has created a favorable environment for the growth of innovative payment systems.

Currently, electronic payments are rapidly developing in Indonesia. A survey conducted by Facebook and Bain & Company found that 77% of Indonesians use electronic payments, with 92% of them using e-wallets for e-commerce transactions. In terms of payment methods, e-wallets, card payments, and bank transfers each account for over 20% of transactions, with e-wallets ranking as the most popular option.

OVO

OVO is one of the most popular e-wallets in Indonesia, launched in 2017 by the Indonesian-based Lippo Group. More than 110 million people have used OVO, and the e-money transacted through the OVO app can be used for various financial transactions. OVO supports a wide range of payments, including credit, electricity bills, data packages, and other bills. A key feature of OVO is that users can earn points when making payments, which can also be used for future transactions. These points are valid for 18 months and are non-transferable. OVO currently supports payments in Indonesian Rupiah (IDR) and USD, with a minimum transaction limit of 10,000 IDR and a maximum of 10 million IDR per transaction. It’s important to note that OVO does not support chargebacks or refunds.

DANA

DANA is an e-wallet jointly launched by Ant Financial and Indonesia’s Emtek Group, often referred to as the 'Alipay of Indonesia.' It allows users to easily make cashless and cardless payments in their daily lives, offering a variety of payment services, including online payments, in-store payments, mobile top-ups, and bill payment installments, with a wide range of use cases. DANA also supports QR code payments, enabling users to pay either with their DANA app balance or by linking a debit or credit card within the app.

GoPay

GoPay is an e-wallet developed by GoJek and is one of the largest e-wallets in Indonesia. GoPay allows users to make online payments, transfers, and top-ups through a mobile application, making it convenient for online shopping, paying bills, or sending money to other users. GoPay has partnered with numerous merchants, enabling users to pay with GoPay at various retail stores, restaurants, and service providers. As a convenient, secure, and widely accepted payment method, GoPay plays a significant role in Indonesia's electronic payment market.

LinkAja

LinkAja is a financial service provided in the form of e-money by Telkomsel and Indonesian state-owned banks Mandiri, BRI, and BNI. It was launched on June 30, 2019. LinkAja integrates the existing electronic payment services of Indonesia's state-owned enterprises and has partnerships with at least 10 government-affiliated companies. Its target users include not only the middle class but also low- and middle-income groups who have not yet experienced digital financial services. Approximately 80% of LinkAja’s registered users come from second- and third-tier cities in Indonesia. As of September 2021, LinkAja had over 75 million registered users. 

Shopee Pay

Shopee Pay is part of the Shopee platform, which initially focused on a C2C marketplace but later transitioned to a mixed C2C and B2C model. As of 2019, the Shopee app had been downloaded 200 million times. According to Mime Asia, Shopee Pay accounted for 29% of Indonesia's total fintech payment transactions, with 33% of the transaction value.

QRIS

QRIS, or Quick Response Code Indonesian Standard, is a standardized QR code launched by the Central Bank of Indonesia to simplify the country’s diverse payment methods and promote the use of digital payments. This system allows users to conduct transactions by scanning a QR code and supports various payment methods, including bank transfers, e-wallets, and other payment services. QRIS aims to enhance transaction efficiency, reduce cash usage, and drive Indonesia’s transition to a digital economy. For merchants, registering once enables them to accept payments from any application that supports QRIS. In addition to simplifying the payment process, QRIS also supports larger transactions by increasing transaction limits, catering to merchants' needs for higher-value transactions.

Quickly Integrate Indonesian Local Payment Methods with PhotonPay

As a highly influential global payment service provider, PhotonPay supports major international card networks such as Visa, Mastercard, UnionPay, and Discover® Global Network, as well as Indonesian local payment methods like OVO, LinkAja, ShopeePay, and QRIS. PhotonPay offers various integration options, including website plugins, payment gateways, and APIs, ensuring secure, efficient, and straightforward connectivity. This enables sellers to provide a full-chain payment solution, allowing consumers to pay in the most familiar and convenient way, reducing payment friction and helping sellers easily accept payments locally in Indonesia.

For more information about the PhotonPay and to sign up, visit www.photonpay.com for more information.