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Digital Payments Transform Indonesia’s Financial Landscape as Cash Usage Declines

Digital Payments Transform Indonesia’s Financial Landscape as Cash Usage Declines

Indonesia
Market Insight

Indonesia is experiencing an accelerated transition toward digital payments, with ProSpace Indonesia’s Payments Industry Report indicating that electronic transaction values increased by 34.5% in 2024 to reach Rp48.2 trillion. Cash usage has declined to 59% of total transaction volume, down from 74% in 2022.
QRIS (Quick Response Code Indonesian Standard) continues its rapid adoption with 21.7 million merchants now participating, more than double the number from two years ago. Meanwhile, real-time bank transfers through BI-FAST processed an average of 37.2 million daily transactions in Q1 2025.
“Indonesia’s payments transformation has reached a tipping point where digital options are becoming the default rather than alternative methods,” explains Rina Hartono, Digital Payments Specialist at ProSpace. “The combination of regulatory support, private sector innovation, and changing consumer preferences has accelerated adoption beyond previous projections.”
E-wallets show particularly strong growth, with the top five providers collectively serving 197 million registered accounts. Integration between e-wallets and bank accounts has improved, creating more seamless financial ecosystems. Meanwhile, “buy now, pay later” services have expanded rapidly, with 14.3 million active users.
Open banking initiatives enable more sophisticated payment services through standardized APIs, with over 120 fintech companies now participating in the central bank’s regulatory framework. Cross-border payment linkages continue expanding through bilateral arrangements with neighboring countries.
Financial inclusion benefits are substantial, with 25.3 million previously unbanked individuals now participating in the formal financial system through digital payment accounts.
For payments industry analysis: Phone: +62 21 5799 8989 Email: info@prospaceindonesia.com Follow @prospace.indonesia on Instagram for updates

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Climate Finance Initiatives Creating Green Investment Opportunities Across Africa

Africa
Business News

Innovative climate finance mechanisms are creating substantial green investment opportunities across Africa, mobilizing capital for projects that combine climate impact with commercial returns. These initiatives are channelling unprecedented funding into renewable energy, sustainable infrastructure, and climate-smart agriculture.
Key developments include specialized green bond programs designed for African issuers; blended finance vehicles combining concessional and commercial capital; results-based financing tied to verified carbon reductions; and climate-focused venture capital targeting early-stage innovations.
These mechanisms have mobilized over $8.5 billion in climate-aligned investments during 2024, with particularly strong flows into distributed solar, green transportation infrastructure, and resilient agricultural systems.
“Africa’s climate finance landscape has evolved significantly beyond grant funding to create genuine investment opportunities with attractive returns,” explains Dr. Kofi Mensah, Sustainable Finance Director at ProSpace Indonesia. “The most successful approaches combine climate impact with clear commercial models addressing Africa’s development priorities.”
ProSpace Indonesia provides specialized climate finance advisory services, including opportunity assessment, mechanism selection, and implementation planning.
For information on African climate finance opportunities, contact ProSpace Indonesia at +62 877 8887 7678 or email info@prospaceindonesia.com. Follow @prospace.indonesia on Instagram for insights on Africa’s evolving sustainable finance landscape.

Fintech Disruption Reshapes Indonesian Banking Landscape

Indonesia
Market Insight

Traditional banking institutions in Indonesia are facing unprecedented competition as fintech adoption rates surge across the country. A new study by ProSpace Indonesia reveals that 47% of Indonesian banking customers now use at least one fintech service regularly, up from 31% in 2023.
Digital payments lead the disruption, with peer-to-peer lending, investment platforms, and neobanks gaining significant market share. The report indicates that traditional banks could lose up to 28% of their revenue streams to fintech competitors by 2027 if they fail to adapt.
“Banks are no longer competing with other banks—they’re competing with user experience and technological innovation,” explains Fitra Widjaja, Banking Sector Analyst at ProSpace. “Institutions that embrace open banking and collaborative models with fintech players are maintaining their competitive edge.”
The central bank’s regulatory sandbox approach has enabled controlled innovation while maintaining financial stability. Meanwhile, recent regulatory changes have opened doors for virtual banking licenses, with five new digital-only banks launched in the past year.
Traditional banks are responding with digital transformation initiatives, with the top five banks allocating an average of 15% of operational budgets to technology investments this year—double the amount from 2023.
The ultimate winners may be Indonesian consumers, who now enjoy more financial options, lower fees, and improved access to credit and investment opportunities.
For more information: Phone: +62 21 5799 8989 Email: info@prospaceindonesia.com Follow @prospace.indonesia on Instagram for updates