Indonesian BNPL Industry Increasing Popularity

- 13 January 2022 08:00 WIB
Most Indonesian e-commerce now provides BNPL options. (Unsplash/CardMapr)
Most Indonesian e-commerce now provides BNPL options. (Unsplash/CardMapr)

JAKARTADAILY.ID - Indonesia has seen a rise in Buy Now, Pay Later (BNPL) method in the past few years, especially since Indonesians' mobility is still limited due to the COVID-19 pandemic.

The concept of BNPL is not new, as it is similar to installment financing products and credit cards. Consumers can make a purchase, then pay for it through installments that suit their budget.

Credit card penetration in the country is still very low per 2021, sitting at only 5%. According to research by, half of the Indonesian population remains unbanked, meanwhile almost all own smartphones in this day and age. As the process is simpler than applying for credit cards in banks, many consumers open BNPL accounts for easier transactions.

“As smartphone adoption across the region increases, app-based services like BNPL make accessing financial services very straightforward," said Zennon Kapron, the director of fintech research and consulting firm Kapronasia, during a conversation with KrAsia on September 28, 2021.

One of the pioneers of BNPL methods in the country is Jakarta-headquartered Kredivo, which was established in 2016. In June 2021, the company raised USD 100 million to expand its debt facility. It aims to reach the goal of serving 10 million consumers in Indonesia, which is already on the 3 million mark per June 2021.

Almost all e-commerce platforms adopt BNPL checkout methods, such as Gojek, Shopee, Akulaku, Home Credit, and Traveloka, who are major BNPL players in the country.

Traveloka, which is working with Bank Negara Indonesia (BNI) - a state-owned bank - in providing credit payment service since 2018, has seen its PayLater users increase by 750% in 2020 since its launch.

At the same time, Tokopedia's BNPL transactions have doubled in 2020, and Blibli reported 63% month-on-month growth between May and October in 2020.

2022 is likely to see an even higher number in BNPL transactions. If's prediction is correct, the BNPL Gross Merchandise Value in Indonesia can reach USD 9,222.0 million by 2028, from USD 889.7 million in 2020, with a steady CAGR of 29.2%.


Editor: Mukhtar Wijaya

Source: KR Asia


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