Indonesia payments guide

A guide to payments in Indonesia.

Welcome to Indonesia

Indonesia is the largest economy in the region, and is poised for enormous growth for years to come.

The country has the fourth biggest population in the world, yet the least-developed ecommerce market in Southeast Asia, representing just 1% of all retail sales in Indonesia in 2015.

Underscoring the size of the opportunity, the market size is expected to rise dramatically from just over $3 billion today to $11 billion in 2019. The bright outlook is driven by demographic trends.

Less than 40% of the population is currently online, bank penetration is under a quarter, and the number of debit and credit cards issued is at only 15%.

As with many developing economies, the shift online is happening through mobile, with over 90% of online users in Indonesia going online via their phone.

Key payment methods in Indonesia

Cash-based payment methods are currently predominant.

When implementing a payments strategy, merchants should keep in mind that the majority of transactions are made with local payment methods, with smartphones as the preferred way to go online and mobile payments to grow in coming years.

ATM payments

The first type of key cash-based payment methods is ATM transfers, which is basically a cash transfer from one account to another.

With this method, the customer receives a voucher code as part of their online transaction, and then completes the transaction at an ATM via cash or card payment by entering the code into the ATM.

Indonesia’s key ATM networks are Bersama, Primo, and Alto, and customers can pay at the ATMs of any Indonesian bank.

Convenience store payments

With in-store cash payments, the shopper orders goods and services online, and completes the transaction of offline by printing a receipt or taking a reference number to a convenience store to make a cash payment.

Convenience stores that support these transactions include Alfamart, Alfamidi, Alfa Express, Lawson and DAN+DAN, making it a convenient way to pay for many Indonesian shoppers.

Inside tips

Indonesia is a highly regulated market, where a local entity is typically required to process locally.

Furthermore, the Indonesia rupiah (IDR) cannot be repatriated.

However, Adyen has made it possible for merchants to offer domestic payment methods in Indonesia with settlement in US dollars.

What Adyen offers

Through a single integration Adyen enables merchants to offer all of these local payment methods, while providing consolidated reporting and transaction level reconciliation. In addition, Adyen provides the ability to settle funds outside Indonesia.

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