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Report: Why proptech will accelerate in Asia

Image credit: Pixabay.

Proptech – the use of technology to solve challenges in the real estate sector – is on the rise, and startups focusing on these technologies are entering a space dominated by large incumbents.

According to proprietary data from global real estate services firm JLL and Tech in Asia‘s research, growing smartphone penetration in Asia, rapid urbanization, and government support are set to thoroughly shake up the region’s real estate industry.

In fact, proptech startups in Asia have received around 60 percent of the over US$7.8 billion invested in proptech worldwide since 2013.

Here are five reasons why this fledgling sector will accelerate in Asia:

1. The rise of new verticals in proptech, such as VR and blockchain

The swift expansion of proptech startups means they will also compete for listings and views. To increase the attractiveness of their platforms, companies will begin to offer value-added services by using new technologies such as virtual property viewing. Imagine walking into a showroom and viewing 10 properties in one go – but without the footwork. This not only saves clients time but also opens up more possibilities for landlords and sellers.

Another buzzword is blockchain, which is often used interchangeably with cryptocurrencies. But in fact, it holds much more potential beyond bitcoin payments and remittance. Together with bitcoin, ethereum can perform “smart contracts” – contracts that help you exchange money, property, shares, or anything of value in a transparent way while minimizing human involvement in agreement verification. This will significantly alter the ways of doing business in real estate.

Image credit: Pixabay.

2. Digitization of existing proptech verticals

At present, the majority of proptech startups in Asia Pacific operate in the vertical of brokerage and leasing. They serve as the channel or marketplace for brokers, property owners, and purchasers, primarily focusing on residential property. The most common ones are list and search startups, such as Singapore’s PropertyGuru, which are effectively online classifieds platforms that combine search engines with brokers’ listings.

As these marketplaces become more mature, they will expand into processes that support brokerage and rentals. These include sales, marketing, and customer relationship management (CRM) tools for brokers and coworking operators.

3. Growth of smart cities

Initiatives for “smart cities” are being implemented all over the world, and Asia-Pacific countries are at the forefront of this trend. As they seek solutions to key issues arising from rapid urbanization, these cities are embracing change and turning to non-traditional options. A total of US$63.4 billion has been earmarked for investment in smart city technology in Asia Pacific.

The evolution of smart cities would prompt the need for smart-property development and management. The data-driven nature of smart cities means that extensive data collection and analysis are necessary to fully realize the benefits of an interconnected ecosystem.

Proptech startups specializing in areas such as IoT and big data can help real estate players – as well as government agencies – transform their operating models and make more informed decisions.

Image credit: Pixabay.

4. Increased number of startups and corporates interested in proptech

In recent years, an increasing number of funds fully dedicated to proptech have been introduced. Real estate incumbents have recognized the value and potential of proptech and are helping to accelerate its growth via corporate venture capital.

One example is Australia’s Esho Ventures, a US$850 million fund that focuses on the landlord-tenant relationship, construction technology, and the impact of millennial lifestyles on the real estate market.

Established incumbents are also getting more involved in the startup community as they realize its usefulness in keeping up with proptech developments. In May 2016, Singapore’s leading property developer Capitaland announced that it is setting up a US$11 million startup fund. Hood Disrupt, the region’s first proptech hackathon, was held in August 2017, with 60 participants making up 17 teams, including students, brokers, entrepreneurs, IT professionals, and lecturers from countries as far as Poland.

5. What millennials want, they get

The age of the digital native is here, and a whopping 60 percent of the global millennial population resides in Asia.

With rapid urbanization happening across the region, these tech-savvy youths are gaining more purchasing power as they come of age. Shaped by their childhood experience with technology, millennials are used to getting information when and how they want it.

While proptech is more established in Europe and North America, the Asia-Pacific region holds much promise for innovation and adoption. Even though consumer preference for offline channels and tools initially served as an impediment to proptech, we can expect the millennials’ natural affinity with all things digital to be one of the strongest drivers of change in this sector.

To find out more about how proptech startups are bringing real estate in Asia beyond the brick and mortar, download this report brought to you by JLL and Tech in Asia.

Converted from Singaporean dollars. Rate: S$1 = US$0.74.

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What the Thai government’s digital vision means for startups in Asia

Dr. Pichet Durongkaveroj, minister of Digital Economy and Society. Photo credit: Tech in Asia.

The large conference hall in Bangkok was like set up like a sweeping showcase of 21st-century technology. Drone displays and transforming cars flanked the exhibition while students roared from the e-games contest next to the robotics competition. Not too far away, other students presented hand-made hydroponics systems made of air-conditioning units and LED lights, and a young man led a workshop on how to build apps. Meanwhile, children rode Ofo bikes around a small track at the hall’s perimeter.

Called Digital Thailand Big Bang (DTBB), the four-day event embodied Thailand 4.0 – a government plan that details its vision of the future, one that involves using technology to address the country’s challenges. DTBB, which ran from September 21 to 24, was organized by the Ministry of Digital Economy and Society (DEPA).

The country is in a unique position: being follower to the innovation game, they’re playing catch-up on a nationwide scale. If the event was any measure, the nation’s government is putting their money where their mouth is; a move that, if successful, could make a difference for the local startup ecosystem.

The rise of government funds

A VR exhibition at DTBB. Photo credit: Tech in Asia.

With a young startup scene, the potential for growth is impressive. According to the Tech in Asia database, Thailand went from just six startups getting funding in 2012 to 28 in 2016.

As part of its digital push, the government is promising support for startups. At DTBB, Dr. Pichet Durongkaveroj, minister of Digital Economy and Society, unveiled a new angel fund for early-stage startups. DEPA will raise no less than US$150 million in collaboration with the Stock Exchange of Thailand by the end of 2017.

This news follows the US$147 million Digital Economy Fund announced in June 2017. The reserve will be split between its four objectives: the growth of tech companies, research and development, DEPA operations, and the National Digital Economy Committee expenses.

In 2016, the Ministry of ICT and Ministry of Finance also launched a US$570 million startup venture fund.

ofo rents bikes out to students within the DTBB event space. Photo credit: Tech in Asia.

Apart from funding, the Thai government wants to improve infrastructure. It is investing $450 million (15,000 million baht) to provide stable wifi connection across the country’s 77 provinces by 2021. It expect to arm 70 million farmers with internet of things technology and implement 10,000 digital points of sale systems across all villages.

This investment will not just supply innovative minds with the right resources but will also go a long way in helping locals solve local problems, according to Durongkaveroj.

“We’ll create a smart city in every province,” he said.

A part of a mockup of Digital Village, Thailand’s newest economic cluster. Photo credit: Tech in Asia.

Efforts to build this vision of the future culminate in Digital Park Thailand, the country’s newest economic cluster. Built in partnership with engineering giant Caterpillar, the US$300,000 project is the size of 80 soccer fields and calls the district of Chonburi its home. It’s located within Thailand’s Eastern Economic Corridor (EEC), which covers three provinces.

A work in progress, the Digital Park will be a smart city that comes with incentive packages, including tax exemptions, smart visas for entrepreneurs and their families, and other privileges for investors and digital specialists.

It’s not about the money

A co-working space set up within DTBB for busy people and tired students. Photo credit: Tech in Asia.

Funding, however, is just a part of a much larger picture. For Monthida McCoole, investment partner at Cocoon Capital, the government push is a great initiative to boost the startup scene’s profile. Aside from increasing funding, events like the DTBB help raise awareness about what startups do – and hopefully to promote their acceptance and understanding in the mainstream. McCoole sees the adoption of a startup mindset as a critical part of an innovative Thailand.

“The whole thing about surveys, customer journey, customer validation, discovery, experimenting, reiterating, fine-tuning — family businesses and SMEs don’t really get that,” said McCoole. “They would execute based on their own assumptions.”

Though these new entrepreneurs are daring and driven, experimentation and hustle are hard to teach, especially in a culture where ‘losing face’ (เสียหน้า sĭa nâa) is a paramount concern. The result is a generation of entrepreneurs who could lose the opportunity to build unicorns.

“When you’re venturing into the unknown – an area that you’re neither familiar nor comfortable with – you need all the help you can get. But culturally, you’d be too embarrassed to ask… you won’t even know where to start.”

This challenge aside, Thailand has all the makings of a strong startup ecosystem. Nati Sang, director of Makerspace Thailand, explained how the country’s culture encourages its people to create.

“[Digital Thailand] is more about unlocking the potential of the Thais in what they’re naturally great at,” said Sang. “When you bring something like the resources of a makerspace into the hands of such people, of course, they’re going to come up with amazing things as long as you develop them right.”

McCoole added, “We’ve made phenomenal progress in the past few years. We’ve got ambition; everyone is doing their part. But there’s a lot more work that needs to be done.”

Work in progress

Deputy prime minister Dr. Somkid Jatusripitak shares the Thai government’s vision for Thailand 4.0. Photo credit: Tech in Asia.

Changes won’t happen overnight. The local population needs to improve its digital literacy, and the startup ecosystem must do more to help budding entrepreneurs imbibe the startup mindset. A survey by the Center for Economic and Business Forecasting in Thailand showed that 55 percent of local business owners who responded had little knowledge about Thailand 4.0. Only 1 percent has a deep understanding of it.

As such, going digital isn’t just another way for Thailand to improve itself. It’s imperative to the country’s survival, and this sense of urgency hangs in the air.

But Thailand’s leaders admitted that their vision is a work in progress. At the DTBB’s opening ceremony, Thailand’s prime minister Prayut Chan-o-cha rallied the troops. “Don’t lose faith,” he said. “If we do this together, it is possible.”

On the second day, deputy prime minister Dr. Somkid Jatusripitak was more candid.

“We were once on par with Malaysia,” he said. “Now, we’re 20 years behind, [but] we’re not less capable.”

Jatusripitak went on to throw around buzzwords. IoT. Automation. Reskilling. Disruption. Thinking outside the box. But instead of sounding tedious and overwrought, they serve as Thailand’s guiding stars. “These,” he says, “are the benchmarks of our progress.”

Converted from Thailand Baht. Rate: US$1 to THB 33.2

Held in September 2017, DTBB 2017 brought together tech leaders from around the world to address topics related to smart cities, digital ecosystems, and transformation roadmaps within ASEAN.

Covering the entire digital technology stack, DTBB 2017 delivered the latest products, solutions, knowledge, and innovations to businesses keen to widen their expertise and digital business offerings. For more information on DTBB 2017 and its program, please visit

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3 cool VR startups you can meet in South Korea this December

Image credit: Pixabay.

As virtual reality (VR) technology attracts both consumers and investors, a wide range of startups are taking AR/VR beyond headsets to give users a more authentic experience.

Scheduled to be held from November 30 until December 2 in Seoul, Korea, Startup Festival 2017 is one of the leading events in Asia’s startup scene. Hosted by the Ministry of SMEs and Startups, the festival’s agenda focuses on the technologies driving the Fourth Industrial Revolution, such as IoT, fintech, ICO, and AR/VR.

Here are three AR/VR startups you need to watch out for at the festival:

1. Locomotion platform/VR treadmill WizDish

Does VR make you sick, literally? Many people experience simulation sickness when playing VR games. If you’re seated but your visual cues signal you’re walking, then chances are you will experience dizziness, nausea, and other symptoms related to motion sickness.

Your body feels disconnected when what you see doesn’t match what you feel. The evolutionary explanation for this is that your body assumes that you’ve been poisoned, so it tries to induce vomiting to cleanse your system.

Wizdish’s ROVR is a VR treadmill that allows a person to walk and move freely in VR worlds. The treadmill listens to the sound made by sliding feet and converts this into forward motion in games. This feature allows you to fully engage with your game and matches the visual input with your physical stimuli. Less sickness, more motion.

2. 3D audio startup Kinicho

Imagine you’re walking through a cave. Your eyes would probably dart to the dark shadows on the wall and the faint light from your torch. Your ears would also likely perk up because sound is an important aspect of “being present” in any given environment. If a bat were to fly over your head, the flapping sound from its wings wouldn’t be the same as what you’d hear if it were to fly beside you.

Traditional audio recordings, however, can only account for the sound from one fixed point – where the microphone was placed.

Image credit: Kinicho.

With 3D audio, the virtual sound in headphones is designed to come as close as it can to sounds in the real world. 3D audio startup Kinicho’s novel approach to producing 3D spatial audio in VR/AR helps developers take better control of their soundtracks.

To deliver a more authentic VR experience, Kinicho’s method takes into account the spatial relationship involving listeners, sound emitters, and the environment in a virtual world.

3. Smartphone VR visor Altergaze

Funded via Kickstarter, Altergaze merges the concept of “crowd manufacturing” with AR/VR. The result is a 3D-printed, smartphone-based VR headset that offers an immersive 110-degree field of view (FOV) experience – and it comes in a compact and wireless package.

Using 3D printing technology to create a product offers a high level of customization. At the moment, Altergaze boasts of over 8.4 million unique variations depending on the design model, smartphone size, and color combinations. The visor looks vaguely like the goggles worn by the minions in the popular cartoon Despicable Me.

Image credit: Altergaze Kickstarter.

The headset is compatible with any smartphone, regardless of platform and display size. Moreover, it uses a device that almost everyone owns: a smartphone. Just slide it in the Altergaze headset, and you’re good to go.

Catch a glimpse of these three promising startups at the Startup Festival 2017. At the events ground, startups and VCs will have the opportunity to network and hold one-on-one consultations. There will also be an On-Air Zone where startups can gain media exposure.

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Tech problems that 2018’s startups will be solving

Image credit: Pixabay.

Failing to keep pace with the proliferation of big data and the increased power of machine learning could also prevent companies from making a substantial shift from standalone processes to more collaborative environments.

Here are the frontiers of technology that startups and institutions will get cracking on by 2018.

1. Fintech and blockchain are established areas that continue to present unique problems

Image credit: Pixabay.

One of the main regulatory problems is that Bitcoin users are assigned a private identity, although every transaction on the bitcoin network is publicly visible on the blockchain. This, in turn, raises the issue of security as cryptocurrency uses public key cryptography to protect transactions. For this reason, regulators and financial players must engage in a constructive dialogue to find proper solutions.

Banks are using blockchain in other ways – not to hide identities, but to verify them. Mitsubishi UFJ Financial Group (MUFG), together with OCBC Bank and HSBC, has completed a proof-of-concept for a Know Your Customer (KYC) blockchain in collaboration with Singapore’s Infocomm Media Development Authority (IMDA).

The KYC blockchain runs on a Distributed Ledger Technology (DLT) platform that enables structured information to be recorded, accessed and shared across a distributed network using advanced cryptography. It allows banks to collect, validate, and share customer information in a secure way, making a complex and highly regulated process possibly more efficient.

This isn’t even AI’s final form. Image credit: Go Game Guru.

2. Bigger is better

In the digital age, the universe of data keeps expanding, leaving some companies in disarray when it comes to making effective use of unstructured data from a wide variety of sources. Having a big set of data at their disposal makes companies’ appetite for hypotheses and trends even bigger.

It is a challenge to develop algorithms that can successfully query varied data sets and deliver meaningful results. Big data can be fed into a machine-learning algorithm trained to process and reproduce the right behavior, while experts need to be able to manage data chaos.

According to IBM, demand for data scientists is expected to grow 28 percent by 2020, so mid-size companies and startups that lack the skills, resources, and capabilities will find it hard to bank on their business potential. In this regard, the MUFG Digital Accelerator programme offers companies the tools and the expertise necessary to achieve their full business potentials.

3. Quantum computing is in its infancy but has huge potential

Quantum computing is likely to have the biggest impact on industries that are data-rich and time-sensitive. It’s especially useful for optimization problems present in many industries, such as supply chain and finance, but are difficult to solve, given the large amount of data needed and the current processing power of computers.

Across industries, quantum computing shows promise in helping to determine attractive investment portfolios, supply chain on a global scale, and ads customers see based on hundreds of their attributes. Quantum computing can even help detect fraud and prescribe personalized medicine.

The development of quantum computing is an expensive process and takes time. The technology is still maturing, and there are some hurdles left to overcome in order to build fully scalable quantum computers.

2018 could be the year in which some applications are brought to light. IonQ, an early-stage company developing quantum computing for commercial applications, plans to bring general-purpose quantum computers to market by late 2018.

Proptech will disrupt housing as we know it. Image credit: Pixabay.

4. PropTech, IoT, and robotics are game changers in construction and sales

For quite some time now, the real estate sector has been ripe for disruption by the use of new technologies. The often-dubbed “proptech” is the real estate version of “fintech”.

Most proptech companies promise to automate the process by giving house-hunters with real-time listings and much-faster search options. Apart from property search engines, other opportunities areas include crowdfunding websites, smart building firms, construction planning, and leasing and liquidity. Spatial-mapping robots could provide virtual tours of properties and help potential homeowners make decisions.

Robotics would be required to build hardware for spatial mapping or microsensors. This is especially needed as the Internet of Things can benefit real estate by lowering utility bills, increasing surveillance, and providing information on parking availability, among others.

Looking to 2018

With 2018 just around the corner, it’s not too early for organizations to evaluate their technology priorities for next year. Startups can help to figure out how technology can continue to meet the changing needs and demands of key industries.

The MUFG Digital Accelerator programme offers innovative companies a chance to demonstrate their solutions for real issues and for some of the problems outlined above. Companies can expect to gain valuable knowledge from bank experts and get access to a global network of clients, investors, and partners.

MUFG will provide participants with the tools and a dedicated working space in Tokyo to create and sharpen their business models. They will guide participants to launch their businesses through the program. The attending startups will have an opportunity to present their business plans in front of plenty of investors on Demo Day and be financing assessed if they meet all specific requirements.

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An ITE graduate, a tech support guy, a career switcher: How 3 people joined cybersecurity

From left to right: Marcus Tan, Lenz Yu, and Lauren Goh.

A hardcore gamer since he was a kid, Marcus Tan enjoyed the popular online role-playing game MapleStory.

When he was 12, however, a hacker attacked his account and stole in-game items worth US$368. “I spent one year accumulating the items. And they were all gone,” Tan recounts.

Jolted by his bad luck – and weak password – he began plotting to hunt the hacker down.

An early calling

A screenshot from MapleStory. Image credit: Euuk.

Tan reached out to MapleStory’s developers and got his hands on the hacker’s details. Shortly after, he traced the lead to a neighboring country. While he didn’t manage to catch the hacker, the incident was still a pivotal experience.

“I knew then my career would involve defeating cybercrimes.”

But it wasn’t until Tan became a student at the Institute of Technical Education (ITE) that he got to work on cybersecurity-related incidents.

But it wasn’t until Tan became a student at the Institute of Technical Education (ITE) that he got to work on cybersecurity-related incidents. By then, he was hooked.

After he graduated from ITE, he took up programming during his National Service stint. Two years later, he applied for the Singtel Cyber Cadet Scholarship program to cover his studies in Infocomm Security Management (DISM) at Singapore Polytechnic.

“ITE was instrumental in building my strong basics, [enabling] me to relate to different cybersecurity technologies. Through the education at Singapore Polytechnic, I was exposed to industry partners, which widened my knowledge of cybersecurity,” he says.

Today, Tan is a cybersecurity associate consultant at Singtel.

“Although my next step is advancing to post-graduate education, I’m grateful to have started from the bottom as the experience has helped shape who I am today,” he explains.

Hard and soft skills – a perfect marriage

It takes more than persistence and grit to get ahead in cybersecurity.

“Tech is not like a cooking recipe. It grows rapidly. We have to keep updating and ensuring we’re up to speed,” Tan explains.

Photo credit: Lenz Yu.

Lenz Yu, a senior security engineer, shares similar views. “I play around with new technologies.”

Before he joined cybersecurity, Yu was in network systems support, filling a role that he describes as being the “tech support guy.” While he appreciated the learning opportunities in his previous job, he found himself craving a much more challenging career.

At a time when cyberattacks were happening in Singapore and the rest of the world, Yu realized that he wanted to play a role in building a safer cyberspace.

He eventually discovered the SkillsFuture Study award for ICT, a government initiative aimed at encouraging Singaporeans to develop and deepen specialist skills needed by future economic growth sectors or in areas of demand. Shortlisted applicants receive a monetary award of US$3,682 (S$5000) to defray out-of-pocket expenses associated with the course they’re pursuing.

With the award, Yu found it easier to commit to the mobile security course he had been eyeing. But he still faced some obstacles.

Weekends were sacred. They were strictly for spending time with his wife and toddler son.

While Yu made it a point to set aside weekday nights for his studies, his weekends were strictly reserved for spending time with his wife and toddler son.

He also got support from his current company, F5 Networks, which allowed him to work flexible hours during the course.

Even so, Yu had to brace himself for exhausting nights. “I had to spend extra time after my class in the evenings to review course materials with my instructor.”

Patience and curiosity won over exhaustion in the end, and now he’s in a career he loves.

“We have to deal with challenges like real-time emergencies and security incidents. It poses a certain degree of challenges because we have to come up with real-time solutions,” he says.

The defenders

Photo credit: Lauren Goh.

“We defend the integrity of the system,” says Lauren Goh, a researcher at iTrust, a center for cybersecurity research at the Singapore University of Technology and Design (SUTD).

At present, she is involved in a cybersecurity project for a water facility with a team of lab engineers, PhD students, and postdoctoral researchers.

Goh used to work at a Singaporean F&B SME. When she realized that none of her fellow employees were well-versed in securing IT systems, her interest in the field grew.

“The skills I’ve learned in my engineering system and design degree were adaptive – I could [adapt them] to any industry,” Goh says. However, she still wanted to supplement her skills with “a formal, in-depth, and educational journey to build a solid foundation in cybersecurity.”

This epiphany led her to pursue a Masters of Science in Security by Design at SUTD with the support of the National Cybersecurity Postgraduate Scholarship (NCPS).

The researcher and part-time student has a new plan in the works. Goh is planning to join Blackzero, a homegrown cybersecurity startup, in the coming months. She will work with a team to build a system that detects security vulnerabilities for owners of large IT networks.

“I see myself working in a role to lead and advance cybersecurity in Singapore,” she shares.

While Tan says Singapore’s Smart Nation initiative “opens more opportunities for innovation, transformation, and new business opportunities,” it’s not without a downside. “Unfortunately, it also attracts more cybercriminals,” says Tan. “We need to be a digitally safe nation.”

He thinks back to the hacking incident that nudged him toward this profession – a reminder that no doubt echoes Yu and Goh’s motives as well.

“I was the victim. Now I’m the attacker and defender.”

If you want to maximize your skills in the ICT field, the TechSkills Accelerator (TeSA) can help. It’s an initiative of SkillsFuture, driven by Infocomm Media Development Authority (IMDA) and in partnership with Workforce Singapore (WSG) and SkillsFuture Singapore (SSG), as well as in collaboration with industry partners and hiring employers.

It is designed to equip budding ICT professionals with the right skills so they can be prepared for the digital economy. Visit their official website to find out about the training opportunities and get ahead.

Besides the programs mentioned in the article, find more pre-approved cybersecurity courses under TeSA’s Critical Infocomm Technology Resource Programme Plus (CITREP+) here.

This series, “Stories from the Ecosystem,” cover features and profiles of people building tech ecosystems around the world.

*Converted from Singaporean dollars. Rate: US$1 = S$1.358. *

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Indonesian fintech in 2018: Better regulation, stronger ecosystem

Photo credit: Unsplash

If you are in the fintech space, look no further than Indonesia.

The pie is growing, with more than 150 fintech startups in Indonesia – 78 percent more than in 2015. Google and AT Kearney also identified fintech as one of the most attractive categories for investors within the country’s startup ecosystem.

Ecommerce vs fintech

2016 was the first time that the number of fintech investments in Southeast Asia overtook ecommerce, although it was still the highest by amount with US$421M.  Investments into Indonesian fintech startups are set to hit a record high in 2017, and this trend is expected to continue in 2018.

Even so, some investors believe fintech is not getting the attention it deserves compared to ecommerce. Despite this, however, the huge ecommerce boom that Indonesia is facing has led to a gold mine for payments startups. Digital payments have become so large that the total transaction value amounted to US$18 million in 2017. The Indonesian government’s ecommerce roadmap also specifies fintech integration and better payment infrastructure as a key focus moving forward.

Banks are involved, too

Photo credit: Bank Mandiri

Indonesia’s financial institutions are certainly not lagging behind in investing in fintech.

Eighteen months since its establishment in January 2016, MCI, the venture arm of Bank Mandiri, Indonesia’s largest financial institution – has invested a total of around 300 billion rupiah (US$22.4 million) in seven startups.

MCI’s investment focused on three areas: payment options, peer-to-peer lending, and small enterprise solutions. Its recent investment in Cashlez, a mobile point-of-sales system, could help merchants with weaker internet connections get access to cashless payments. With Bank Mandiri’s financial expertise and access to a vast network of merchants and customers, fintech startups can scale very quickly.

Other lenders joining the digital wave include private lender BTPN, which spent 1.3 trillion rupiah (S$131 million) to develop a digital platform called Jenius, over the past three years. DBS Indonesia also launched Digiland, a completely paperless and signature-free banking experience.

Lending their way to success


Photo credit: Bindalfrodo.

Lending is a popular fintech sector that will continue to grow. In fact, 17 percent of fintech startups are lending platforms, and businesses like Modalku and Investree leading the charge. Consumer confidence in peer-to-peer lending businesses also got a boost from the Financial Services Authority (OJK) regulationregarding information technology-based money lending services.

The expansion of the lending scene will help support micro, small, and medium enterprises (MSME) within Indonesia. “Poor access to financing can be considered as a major reason for the low productivity of Indonesian MSMEs,” says Eddi Danusaputro, CEO of MCI.

He also points out a huge gap between the available market of MSMEs that fintech players can serve and existing players in this space. “Current players tackle less than 20 percent of financing to MSMEs,” says Eddi.

The peer-to-peer scene may face some competition on all fronts – good news for MSMEs, but bad for lending startups.

“Fintech lending is a toss-up,” says Donald Wihardja, partner at Convergence Ventures. “Modalku is going strong, but the Chinese fintechs are coming. And the banks are not standing still.”

Going cashless – by Indonesians, for Indonesia

Buyers and sellers at a market in Lombok, Indonesia. Photo credit: erikj57 / 123RF.

Indonesia’s largest startups are riding this wave and creating more applications for Indonesians to go cashless. Go-Jek has allowed people to pay for its on-demand motorbike service through its mobile app. At this year’s Global Mobile Internet Conference, Go-Jek CEO Nadiem Makarim revealed that users will be able to use its e-payments service Go-Pay to transact at various online marketplaces within the next three to six months. Indonesians also heavily shop on Bukalapak and Tokopedia with virtual wallets, and even buy local mutual funds with Bareksa.

But the road to cashlessness will take some time. Bank Indonesia has been cracking down on companies like Grab, Tokopedia, and Bukalapak that operate e-wallets without the right license.

“We are aiming for ‘less cash’ first before achieving ‘cashless’,” says MCI’s Danusaputro. “We believe there are still lots of homework to do for all stakeholders to make this dream realize.”

Better fintech regulations

In 2016, 49 percent of fintech players felt that the regulatory processes in Indonesia for fintech was too slow, and 61 percent felt that it was not clear enough. 2017 saw the Indonesian government taking steps to provide a better regulatory environment and clarity for fintech startups, and this is set to continue in 2018. This will give confidence to startup founders and investors in Indonesian fintech.

The Financial Services Authority (OJK) of Indonesia has launched a registration system for fintech startups, marking a formal recognition of the sector. By June 2017, eight startups have registered, with more in the process. OJK also inaugurated a FinTech Advisory Forum in June 2017, a platform designed to set the direction of the fintech industry’s development. The central bank, Bank Indonesia, plans to follow in Singapore’s footsteps and create a regulatory sandbox for fintech startups.

The Indonesian economy has carved a clear path to leverage fintech for more financial inclusion and literacy. Investors and startups can look forward to a strengthened fintech ecosystem and ride the wave. With clearer rules, better data security and more consumer protection, fintech in Indonesia is now a national priority to improve the lives of its citizens.

FINSPIRE 2017 is the yearly event held by Mandiri Capital Indonesia (MCI), a subsidiary of Bank Mandiri, to accelerate fintech development in Indonesia. It brings together financial technology organizations, startup communities, and fintech enthusiasts to discuss the future of financial technology in Indonesia.

MCI aspires to help grow the Indonesian fintech startup ecosystem and accelerate the creation of products and services that will support the banking and financial industry.

To find out more about FINSPIRE and MCI, visit their main website here.

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Meditation, management, meetings: Running a fintech startup in Indonesia

Aria Widyanto, vice president at Amartha. Photo credit: Amartha.

It’s 5:20 in the morning, a time when many adults are tucked snug in their beds with visions of durians dancing in their heads. But Aria Widyanto isn’t one of those adults. He’s vice president of fintech startup Amartha in Jakarta, so that means it’s time for him to wake up. He’s only had five hours’ sleep, but startup duty calls.

Indonesia is home to a creative population that skews young, but it can be a struggle to finance any kind of venture past basic necessities. Amartha offers loans to small businesses, like grocery stalls or tofu stands. Using an alternative to traditional scoring-type methods for measuring the likelihood that a business pays back, the loans range from US$100 to US$2,000. It only serves female borrowers, with a client base of around 50,000. Often, Amartha’s clientele are located outside of Indonesia’s cities, in smaller towns.

Amartha only serves female borrowers, with a client base of around 50,000.

Amartha keeps its employment numbers in line with their customer base: 90 percent of the startup’s staff are women.

“I have to be comfortable being a minority,” Widyanto quips.

Founded in 2010, the startup also specializes in peer-to-peer lending, alternative investments, and big data credit scoring. It has 320 employees, 70 of which work at the head office in Jakarta.

Amartha’s “warmed up” office. Photo credit: Amartha.

So, what does it take to be one of the brains behind running a fintech startup in Indonesia? Widyanto’s day-to-day tasks aren’t that different from other managers. There are just more of them.

All in a day’s work

Widyanto was a corporate banker but now oversees product, risks, social impact, and partnership strategy at Amartha. Upon waking up, the first thing on his mind is dealing with urgent matters that came up in the night, so he begins by checking his WhatsApp messages. Then it’s time to steel himself for the day. “I meditate every morning for 20 minutes between 5:30 and 6 am and at night between 9 and 10 pm,” he mentions.

After meditation, it’s time for breakfast – specifically, granola and a banana paired with either milk or yogurt – the perfect fuel needed before facing Jakarta’s legendary traffic with the help of another familiar startup.

“I go straight to office or [to a] meeting place outside the office, depending on my schedule,” he tells Tech in Asia. “I take a Go-Jek.”

By now, it’s 8:15 – still bright and early, but that allows Widyanto time to ease into the day. “Since it is very likely that I am the first person to arrive in the office, I usually prepare my coffee while browsing through some news portal,” he explains. Being readily available in the office also means that he’s present for casual chats with other employees. “Real business won’t take place until the office warms up at around 9:30 am.”

He shares his own desk with different people every day.

A “warmed up” office at Amartha means “chaotic in a good way,” Widyanto explains. In typical startup style, they keep things busy but casual – and they hit their deliverables on time.

“We went to horror movie night in the middle of the week. There are no cubicles. Everyone sits in shared desks with first-come-first-served basis, just like a coworking space,” he says, noting that he shares his own desk with different people every day.

Lunch is an informal affair, spurred on by someone in the office shouting out what they want to eat as an open invitation for others to join. However, Widyanto often orders in for dinner. And what’s a startup without a stocked pantry? The office is full of snacks and bread to munch on.

Things wrap up around 7pm – in the office, anyway. Widyanto meets friends for dinner or drinks afterwards. “I schedule meetups with friends both during weekdays – during or after office hours – and on weekends”.

Winding down from the day involves meditation and some leisure activities of choice. “Before bed, I usually read books or research something of interest,” Widyanto mentions. “And I write a travel blog too.”

Meetings, meetings, meetings. Photo credit: Amartha.

Work and play

Of course, no day is a typical day at a startup, but Widyanto mentions a consistent theme: meetings. A lot of meetings. In fact, he estimates that 60 percent of his workday is spent in meetings or talking to people, while the other 40 percent takes place behind a screen.

There’s plenty of talk required – Widyanto presents new ideas to stakeholders; helps oversee product management meetings; and briefs teams on the risks involved in strategic initiatives, projects, and marketing materials. When he’s not doing that, he’s meeting with clients for strategic partnerships, or regulators.

Throughout the day, the office communicates over a Slack group that contains a fair amount of “silly jokes and pictures” in addition to business chat.

However, all of this works for Widyanto – meeting with a lot of people is his favorite thing about his work, along with collaborating with colleagues and visiting villages to get feedback from people who have used Amartha’s products.

Little corners to work or nap in. Photo credit: Amartha.

A sale at Amartha is marked by the ringing of a bell as well as ordering pizzas to celebrate. If an employee needs a break, some common ways are watching TV, playing mini golf, grabbing ice cream, and – of course – in-office naps.

It’s a colorful, busy kind of environment, though one that’s hard to communicate to his parents; they do not understand what he does, he stresses. “Until they read some news or watch TV with your face on it, they never ask. And when they ask, all I can say is that I am working for an internet company and I can pay my own bills. No need to worry. End of discussion.”

The secret to partnerships

Amartha’s line of work also puts it in the unique position of being able to help investment firms like Mandiri Capital, which couldn’t offer loans to “ultra-micro” ventures without the startup’s help. Part of the wider Mandiri Group, Mandiri Capital connects Amartha with opportunities in collaboration, like channeling, building new products and services, and network optimization. Mandiri Capital partnered with Amartha as a series A equity investor this year.

Go to meetings.

If you’re looking to get a foot in the door in the Indonesian startup ecosystem, Widyanto’s advice is simple: go to meetings. “Indonesian startups are basically open to collaboration. Since most of the people in the ecosystems usually know each other as friends or friends of friends, it is always great to network and learn from each other,” Widyanto says. At best, you’ll gain a business idea or partnership for the price of your coffee. At worst, you’ll get new ideas or inspiration to keep moving forward.

Converted from Indonesian rupiah. Rate: US$1 = IDR 13504.

FINSPIRE 2017 is the yearly event held by Mandiri Capital Indonesia (MCI), a subsidiary of Bank Mandiri, to accelerate fintech development in Indonesia. It brings together financial technology organizations, startup communities, and fintech enthusiasts to discuss the future of financial technology in Indonesia.

MCI aspires to help grow the Indonesian fintech startup ecosystem and accelerate the creation of products and services that will support the banking and financial industry.

To find out more about FINSPIRE and MCI, visit their main website:

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How startups play a key role in Indonesia’s payments scene


Photo credit: Flickr/Daniel Giovanni.

Cash is the main method of payment in Indonesia. But some notable startups are leading the country’s payment revolution.

The statistics that show cash is king are striking: There are about 260 million people in Indonesia but only about 17 million credit cards. There are about 143 million debit cards in circulation, but you can’t use them for online shopping. Less than 60 percent of the population has a bank account.

Indonesians can’t take advantage of cashless payments, but that could change with with startups that provide alternative methods to pay.

Exploiting simplicity

Mandiri Capital director Eddi Danusaputro (L) with Teddy Tee, co-founder and CEO of Cashlez. Photo credit: Tech in Asia.

One startup that is helping drive Indonesia toward a cashless society is Cashlez, with pioneering mobile point-of-Sale (mPOS) systems. It helps solve one of the problems Indonesia faces in its cashless mission – many merchants don’t accept cards.

In the past two decades, the only device you could use for card payments was the EDC (electronic draft capture). For fast-growing small and medium enterprises, it can be hard to apply EDC due to its selective and high requirements. Merchants also tend to dislike the EDC because it’s a hassle to maintain. For example, you need an engineer to set up the device and visit regularly for software updates.

To encourage more merchants to use card readers, Cashlez developed a device that is easy to use. The card reader uses an app on the merchant’s phone which can be installed with a few simple taps. It accepts most cards from different banks, including debit, Visa, and Mastercard. Cashlez started testing the product in April 2016 with 50 customers and now provides the card reader to more than 1,000 merchants, mainly in the retail and tourism industry. The company plans to distribute around 4,000 card readers to Indonesian businesses.

Leveraging an extensive agent network

Kudo agent

Photo credit: Kudo.

More Indonesians are being empowered to pay online and Indonesian startup Kudo is cashing in on this trend by allowing people without a credit card, bank account, or even internet access to buy online.

Kudo does this by setting up point-of-sale kiosks in public places that enable customers to buy online goods. The kiosks accept different forms of payment, including cash.

Kudo also enables online payments through its agent network. Kudo agents use an app on their phones to sell products to customers using the Kudo site. Kudo’s network is quite impressive – it currently has over 400,000 agents in over 500 towns and cities in Indonesia. Ride-hailing company Grab, which is growing its digital payments capabilities, acquired Kudo for a high double-digit million sum in April this year.

Online payments giant

Photo credit: Doku.

It’s not just consumers who are moving towards cashless payments. Big corporations are embracing them too. Doku, a major pioneering player in Indonesia’s digital payments scene, is part of this trend. 80 percent of Doku’s customers are big corporations with a high volume of complex monthly transactions. The other two startups we’ve profiled here are mainly consumer-facing but Doku is notable for being a major player in the business arena.

Apart from big corporate clients, Doku is also interested in serving SMEs. It does this through MyShortCart, which gives merchants the ability to let their customers pay via credit cards, bank transfers, convenience stores, and ATM transfers. The product mainly targets merchants who sell their products via social media networks like Facebook.

Doku’s significant impact on Indonesia’s payment scene is evident in the more than 1 million Indonesian customers using its product and its partnership with more than 22,000 merchants. It has already surpassed US$1.1 billion in total transactions and services clients like AirAsia, Sinar Mas Land, Oppo, and Indonesian Idol.

Indonesia’s digital economy is aiming to reach an expected target of US$130 billion in ecommerce transactions by 2020. It’s currently hampered by the fact that most Indonesians don’t use cashless payment methods. The three startups profiled here could change all that, leading to a transformation in Indonesia’s payments.

FINSPIRE 2017 is the yearly event held by Mandiri Capital Indonesia, a subsidiary of Bank Mandiri, to accelerate fintech development in Indonesia. It brings together financial technology organizations, startups communities, and fintech enthusiasts to discuss the future of financial technology in Indonesia.

MCI aspires to help grow the Indonesian fintech startup ecosystem and accelerate the creation of products and services that will support the banking and financial industry.

To find out more about FINSPIRE and MCI, visit their main website.

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Line prepares to challenge Amazon’s Alexa and Google Home

Video credit: Line.

A father and his young daughter are preparing to go to sleep. “Lights off,” he says to a glowing smart speaker, next to their bed.

The smart speaker is Line’s Wave – which hit the shelves on October 5.

“Lights on,” their daughter protests. Dad laughs.

“No, lights off.”

“Lights on!”

Later, Mom, who’s on the way home from work, sends a message to the smart speaker: “Slept yet?”

The daughter replies: “Clova, tell Mama that Papa is asleep.”

This is Line’s vision of its smart speaker, Clova Wave. It’s heartwarming, but the question remains: can Wave and its digital assistant, Clova challenge Alexa or Google Assistant?

Image credit: Line.

Line playing catch up

“Line is only six years old; other companies have more than fifteen years’ of experience,” Line CTO Park Euivin says through a translator at Line Developer Day 2017.

“But even if we have a late start, I don’t think there is any company that matches us in speed,” she says.

Within a year, Line had created Clova, which stands for “cloud-based virtual assistant.”

The accompanying hardware, Wave, opened for pre-orders in July this year. Line Developer Day 2017 marks the official release of the smart speaker.

Wave’s specs at Line Developer Day 2017. Photo credits: Tech In Asia.

Park says that Line has parent company Naver, which owns the dominant search engine in Korea. Like Google and its device, there’s potential for Wave to work with Naver’s search data.

Also, with key offices in Taiwan, Thailand, Indonesia, and Korea, Line is likely to have access to language specialists in these countries, whether in-house hires or external partners.

On top of that, Line reported a monthly active user count of 169 million across four key countries at Line Developer Day. The wealth of user data available means localization opportunities for the home speaker.

“I don’t think anyone has an advantage [in the smart home market],” says Park. “We have data about Asian users and we can leverage that.”

Line says they’re the first to launch a Japanese smart speaker powered by AI.

Apart from collaborations with big boys like Sony and LG, Line is also open to partnering any companies to make their users’ lives better. Their current partners range from convenience store Family Mart to holographic home robot manufacturer Gatebox.

Video credit: Line.

A long road

Line faces formidable foes in Google and Amazon. Google has several ways to get user data and lock users in. Google Chrome is the dominant web browser. Gmail has more than one billion monthly active users. Over 85 percent of the world’s web searches came from Google in July 2017.

When asked about collaboration with Google specifically, Taiichi Hashimoto, who oversees the Clova project, says Line wouldn’t rule out the possibility.

Google Home shipments are expected to reach several million units in 2017. Meanwhile, Amazon Echo has surpassed them – shipments are expected to reach over 10 million units in 2017.

It’ll be an uphill battle for Line, whose team apologized for shipment delays of the trial version of Wave released in August.

But Line’s main goal for Clova and Wave in 2017 is not user acquisition. Wave appears to be just a side dish to complement Clova: Line is focused on creating API openings, growing the Clova developer ecosystem, and involving as many engineers as possible in Clova.

At the moment, Wave can play music, tell the weather, time, and your fortune, act as a remote control, read and send Line messages, and chat with users. But with in-house, third-party developers, and partners, Line plans to increase Wave’s features and fine-tune the smart speaker.

“Hopefully, we can create many different applications and we will grow from there,” Hashimoto says.

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From math-hater to programmer and veteran technopreneur

Photo credit: Christopher Yeo.

“I’m a greenie,” says Christopher Yeo, founder and CEO of AI startup He turns to a plant next to him, holds a leaf, and shakes it like a hand. Everyone in the room chuckles.

“I was only interested in canoeing then. I really had fun outdoors,” says the serial technopreneur and investor who runs his own venture fund. “I mucked around a lot and didn’t quite like math. I got through A-levels by the skin of my teeth.”

To most, the dislike for math would last a lifetime. For the programmer, change came in a surprising form in university — religion.

“I said, OK, God, you need to help me like math because I hate math!” He laughs.

After praying, he experienced a “180-degrees change.” In fact, he became really good at the once-dreaded subject.

“There was no turning back. The second year of university onwards, I had no subjects apart from math and computer science,” he says.

Yeo decided to do a double major and got first class honors in both. He started his own software venture just four years out of school, and then became the CTO of Comex Frontier, which was acquired in 2005.

He joined ETPL – the commercialization arm of Singaporean science and tech research agency A*STAR – in 2006. After a year, Yeo left for the National University of Singapore’s NUS Enterprise to learn how to encourage students to create startups.

Ten years on, the veteran entrepreneur is giving back. He is mentoring and creating startups for the venture co-creation (VCC) initiative together with ETPL.

Image credit: Pixabay.

A chance encounter in Starbucks

The idea for A*STAR ETPL’s venture builder wasn’t formed in a corporate meeting room. Yeo says it was created in Starbucks at Fusionopolis, home of A*STAR and a major research and development complex in in Singapore’s One-North tech district.

“I was just daydreaming while waiting for a meeting,” Yeo says. By chance, he bumped into his ex-colleague, Tng Tai Hou, vice president of technology development from A*STAR ETPL.

“We haven’t met for a while, but we ended up talking for one and a half hours and forgetting our meetings.”

Tng (together with another partner, Lee Han Boon) belonged to the digital technologies commercialization division in A*STAR ETPL. Together with Yeo, the trio is now back together as a team to run the VCC framework.

While startups are usually created before entrepreneurs seek investors or a CTO, the VCC framework matches promising pre-seed technologies with entrepreneurs and investors even before new startups are created.

Most venture capitalists and angel investors are reluctant to invest in pre-seed companies as they’re riskier. But Yeo plans to turn the entrepreneurial process on its head.

“One way to get things cooking is to figure out what technology the industry needs, raise the funds for that, and then find the entrepreneurs,” Yeo says.

One way to get things cooking is to figure out what technology the industry needs, raise the funds for that, and then find the entrepreneurs.

Being veterans in the field, they knew Singapore’s technologies like the back of their hands. But taking them “from mind to market” was a problem.

Yeo thinks the VCC model is more proactive compared to the conventional method, as it “match-makes” entrepreneurial teams with partners and investors, and also helps these startups get a foot into regional markets.

While venture capitalists usually just cherry-pick, VCCs go out, do market research, and identify gaps in the market, go-to markets, and investors. They even round up the potential startup founders.

“Venture capitalists scour around and find what they can get deals for. We’re creating the deal itself,” Yeo says.

Eventually, Yeo aims to link startup founders to overseas markets, investors, and clients through the VCC framework.

“We were first specifically thinking of how to create a company in the AI space,” Yeo says., an AI-as-a-Service platform that businesses can leverage on for their own applications, is one of the first co-creations of ETPL and Origgin – a local investment holding company focused on Southeast Asia.

One of the by-products of is a naturally intelligent digital assistant which engages customers through various types of end-user interfaces and channels.

A\*STAR ETPL plans to create 7 to 10 startups within three years with each VCC partner. Image credit: Tech In Asia.

Once an entrepreneur, always an entrepreneur

Yeo’s two years in ETPL and NUS Enterprise were formative to his current efforts. “I know many researchers by name now. These are my go-to people,” he says.

Exactly ten years later, the VCC framework was born. Yeo plans to tap on researchers to help nurture technologies and bring them to practical fruition.

One of the startups Yeo is mentoring now is in agriculture – an area he has been passionate about since his school days. Archisen combines urban farming systems with internet-of-things technology and data analytics.

Sven Yeo, co-founder of Archisen, says they want to adopt technology from A*STAR ETPL into their platform. The VCC framework would allow the startup to expand their technical capabilities rapidly.

With so many areas of tech to be developed and contextualized for agriculture, it’s difficult for the startup to spread their resources. For instance, Archisen is looking into autonomous machines that can identify anomalies or diseases through photos. These anomalies would otherwise be difficult to detect with the naked eye.

With A*STAR as a partner, Sven Yeo says they can assimilate helpful tech and reap benefits quickly. “We can go to market faster than if we were to organically raise funds and develop the intellectual property ourselves,” he says.

Yeo shows Singapore’s Minister of Finance Heng Swee Keat how system can be integrated with business applications, for instance the smart system co-created by Singapore-based home appliances manufacturer Ryker. Photo credit: A*STAR.

Christopher Yeo eventually hopes to “create a more informal community of startups that can work together, get projects together, and cross-license technology together.”

They’re looking long-term, where startups last for ten to fifteen years, get traction, and establish a global reach.

“If startups don’t manage the exit properly, they become zombies. Ai si bui si, ai wa bui wa (a Hokkien proverb which means one can neither die nor live)!” Yeo says.

Visit ETPL’s website for technology offerings and startup portfolio or write to with your comments or questions.

Or, subscribe to A*STAR Innovate – a bimonthly electronic newsletter that features A*STAR’s latest technologies and successful company showcases.

This series, “Stories from the Ecosystem,” covers features and profiles of people building tech ecosystems around the world.

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5 Indonesian fintech startups to watch in 2018

Photo credit: Unsplash.

Indonesia’s startup scene is a hotbed of innovation, and it’s attracting the attention of corporates. This is especially pronounced in the fintech industry. Traditional institutions are recognizing the importance of going digital, and are drawn towards working together with startups to fulfill the changing demands and needs of their consumers..

Collaboration is the theme of fintech conference Finspire 2017. Taking place on October 19 at Soehanna Hall in Jakarta, fintech organizations, financial institutions, regulators and digital experts will come together to share their knowledge, ideas, and insights on the financial services ecosystem.

The event is open to investors, founders, students, aspiring entrepreneurs, and startup communities. For fintech enthusiasts eager to get a glimpse of what’s in store, here’s a roundup of five up-and-coming fintech startups that have caught our eye:


Photo credit: Jurnal

Jurnal is a software provider that helps businesses save time, eliminate unnecessary entries and simplify the process for both enterprise owners and accountants.

The cloud-based accounting software offers features like instant report generation and affordable monthly subscription fees. With 57 million SMEs spread out across the country, Jurnal has a huge market to tap, and it’s seeking expansion through partnering up with companies and government institutions.

Jurnal’s most recent funding was in early 2016, where it raised an undisclosed series A round of investment from East Ventures, Fenox VC, and angel investor Budi Setiadharma. Earlier this year, it participated in Google’s Launchpad Accelerator program in San Francisco.

Photo credit: Cashlez

Targeted at local SMEs, mobile point-of-sale startup Cashlez solves key pain points that hinder these businesses from adopting cashless payment systems. Traditional electronic data capture (EDC) machines require a strong internet connection to process card payments, yet the lack of stable internet is a common problem in many areas across Indonesia. EDCs also require high maintenance costs which means that these machines are limited to high-end businesses.

Through Cashlez’s wireless card readers, local businesses have a chance at using cost-efficient digital payment solutions. A large unmet demand offers huge potential for growth; a significant portion of the 57 million micro, small and medium businesses across the country have yet to adopt cashless payment systems. And while there are 17 million credit cards and 113 million debit cards across the country, there are just about 1 million point-of-sales terminals for card transactions. Cashlez seeks to partner up with banks to distribute its solution.

In mid-July this year, Cashlez announced a US$2 million funding led by Mandiri Capital Indonesia (MCI). It also received funding from individuals and GAN Kapital.

Photo credit: Tech in Asia ID

Snapping a shot of your face and ID card and uploading that along with some personal data may not be the usual process for a loan registration – but that’s all that’s required for users of TunaiKita, a mobile-app-based loan service..

Formed through a joint venture between Wecash Southeast Asia, PT Kresna Usaha Kreatif, and PT JAS Kapital, TunaiKita combines finance, mobile technology, big data and machine learning to address the need for unsecured loans in Indonesia. The country’s growing middle class requires a more efficient approach for helping the underbanked in their loan application process while weeding out potential fraud cases, yet current methods for credit checking aren’t scalable.

TunaiKita steps in with technologies like its Loan Underwriting System, where debtors are evaluated through factors like their timeliness in paying bills and reasons for taking up a loan. Striking up collaborations with financial institutions for online lending partnerships and launching additional loan products are in the works for TunaiKita, as the company strives towards its goal of lending US$3 million by the end of 2017.

A Payfazz agent. Photo credit: Payfazz.

Over half of Indonesia’s population (64 percent) is unbanked – yet 50 percent of the unbanked adult population currently owns a smartphone. Thanks to Payfazz, locals using a smartphone will now have access to mobile banking services.

Payfazz’s digital wallet services let users conduct online transactions for their everyday transactions – from getting pre-paid phone credit to paying for electricity bills. Users hand over cash payments to the startup’s network of mobile bank agents, who complete payments and transfers on behalf of the user.

Similar to how bank branches are peppered all across a city, Payfazz aims to build up an extensive network of agents who can help users to complete transactions – a critical solution in a country where bank branches operate beyond capacity to serve thousands of customers.

Just recently, Payfazz graduated from the summer batch of Y Combinator (it’s the first Indonesian startup to make it to the accelerator). In addition to a seed funding of US$120,000 from YC, Payfazz also received funding from MDI Ventures, a corporate venture capital initiative by Telkom Indonesia, and participated in its incubator program, Indigo Startup Nation.

Since its YC graduation, PayFazz has been working with over 15,000 agents in Indonesia and processing monthly transactions totaling over US$1 million. The startup seeks to expand further by reaching out to relevant markets through Telkom’s marketing channels and partnering up with financial institutions for system and technological support.

Photo credit: Tech in Asia ID

KoinWorks is an online marketplace that connects borrowers and lenders. Similar to other P2P lending sites, KoinWorks targets micro and small enterprises – a group whose needs are underserved by traditional financial institutions.

What sets KoinWorks apart are features like its Protection Fund, which an initiative compensates investors for losses from non-performing loans. Currently made up of 20 to 30 percent of revenue received by the company, KoinWorks seeks to boost its Protection Fund through partnering up with a credit insurance firm.

A 2016 report from the International Finance Corporation and USAID described the SME market in Indonesia as “one of the fastest-growing sectors in the country,” with potential demand for credit among women-owned enterprises totaling at US$6 billion. With most SMEs unable to secure funding from banks due to a lack of collateral, there’s a sizable gap that can be filled by peer-to-peer lending.

Having entered Indonesia’s P2P lending space in March 2016, KoinWorks has received angel funding and is currently in discussions for venture capital investment.

US$1 = IDR 13440

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