Indonesia’s Payment System Roadmap 2025

Reinaldo Gani
Mar 3 · 6 min read

I spoke briefly about my excitement to improve payment interoperability in Indonesia. As part of Saison Capital’s continuous effort to track Indonesia’s payment scene, I will talk about Indonesia’s Payment System Roadmap 2025 in more details and its impact to the ecosystem starting from existing landscape, drivers for change, pain points, payment roadmap, and future possibilities.

Existing Landscape

Indonesia’s digital payment started to develop only in the early 2000s. Indonesia’s payment rails are divided into 2 parts, retail & wholesale. More than 85% of all transactions are currently processed with SKNBI (retail payment rails). This is not surprising as Micro & Small Enterprises in Indonesia attribute to 99% of all businesses and contribute 60% of Indonesia’s GDP.

Retail Payment System

Wholesale Payment System

Despite all of the government’s push to increase the usage of cashless payment instruments, Indonesia is very much a cash society, second biggest in the world after India. Only around ~15% of transactions are using non-cash payment methods.

Drivers for Change

I observe there are 2 major adjacent trends that popularise cashless payment methods to mainstream populations:

Pain Points

There are a few issues in existing payment infrastructure that hinders convenient, cheap, and safe payments.

The Roadmap

Indonesia Payment System Roadmap. Source: Bank Indonesia

1. API-based Open Banking

  • Standardised API Specifications
    - Protocol: HTTPS
    - Data format: JSON
    - Architecture: REST
  • Standardised API Security
    - Authorisation framework: OAuth 2.0
    - Encryption: SHA-2/AES-256
  • Standardised API Contract
  • Standardised Data Format

2. Instant Retail Payment System

  • QRIS: Standardised QR to accept/send payments (Launched in 2019)
  • BI-FAST: real-time bank-to-bank settlement, eg. SG’s Fast, PH’s InstaPay, UK’s Faster Payment
  • National Payment Gateway: Card-based interoperability between ATM, debit card, credit card, e-wallets via payment switches
  • Universal Payment Interface: Middle-end module that glue all of the above together by providing ID proxy address & 2FA

3. Financial Market Infrastructure

4. Data Management (KYC, AML, Audit, Reporting)

  • Proxy address BI-Fast, eg. SG’s phone number/UEN PayNow
  • Reporting & audit
  • Data Management

5. Licensing, Regulatory, Monitoring

  • Regulatory Sandbox
  • Data Policy
  • Cyber security

Putting All Things Together

Indonesia Payment System Roadmap 2025

Similar to other countries like Singapore and India, payments revolutions in Indonesia started with the idea of having an instant payment infrastructure to enable cheap & fast payments. The real benefits of all different projects is how it will collapse the payment process into a simplified and standardised like below diagram.

Illustration of Open Banking & Instant Payments Architecture

Some initiatives such as QRIS and GPN have simplified & standardised some of payment use cases such as pay-to-merchant (push & pull) and pull card-based transactions will benefit MSMEs by enabling unified cashless payment acceptance and low cost to process payments. With BI-FAST, now users can do peer-to-peer payment (push & pull) fast & cheap. All of these combined arguably pose an existential threat for international card schemes such as Visa & Mastercard alike.

MDR for GPN card transactions mandated by Bank Indonesia

For the government, an efficient payment system can help in executing various social payout programs such as Bansos effectively, directed, and affordable. As an effect, the barrier to adopt cashless tremendously lowered and financial inclusion will be boosted.

It is yet to be known the exact scope of all of mentioned initiatives. For BI-FAST, will fintech companies with certain license can participate? Can fintech companies partner with bank to get access to BI-FAST? How much transaction threshold will be processed with BI-FAST?

However, Bank Indonesia has emphasized in their 2025 Blueprint that their goal is to digitalise banks via a universal API to foster integration between Bank & Non-bank financial institutions while balancing data privacy, security, and customer’s protection.

For fintech or technology companies in general, the democratisation of bank’s data poses great opportunities to create multitudes of new services & products. In the retail environment, data aggregation and instant payment will catalyse the embedded finance proliferation by further unbundling finance use cases in different value chains.

PSD2 in Europe unleashes various new business opportunities. Source: McKinsey Analysis

As the implementation of Indonesia’s Payment System unfold, there will be big winners and losers. With more than 17,000 islands, the biggest bottleneck remains in how to convert cash into a digitalised form. I’m optimistic that this evolution will bring waves of innovations that can truly transform Indonesian society at large.

Are there any other thoughts, features, perspectives that I miss? Feel free to reach out to me and I would like to understand more and incorporate it into future thesis.

Shout out for Mehul Mangalvedhekar and Yosua Nathanael for thoughts, inputs, and feedbacks.

Reinaldo Gani is an Associate at Saison Capital, looking at investment trends & opportunities in SEA & India, supports early-stage founders, can be contacted at aldo@creditsaison-ap.com

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