Understanding the Indonesian fintech market at FINSPIRE 2016
By Anisa Menur A. Maulani for e27
The first day of FINSPIRE 2016 ended yesterday with pitching sessions of 21 teams, followed by ‘Office Hour’ mentoring sessions with leading speakers such as Sam Hall (Program Director at Startupbootcamp Fintech), Dondi Hananto (Founder of Kinara Indonesia and Unitus Impact), and Vidit Agrawa (Head Operations & Special Projects at Uber).
Of all the startups pitching in the sessions, there were several companies working at the intersection of fintech and agriculture. There was Crowde, which is a crowd investing platform for agricultural products, and also Eragano, an end-to-end mobile platform that lets farmers access information, get connected to microloan facilities, and even sell their products to hotels and restaurants through an online marketplace.
There were also startups that focus on improving financial management for professionals such as Paper, a mobile invoicing and payment solutions for freelancers, as well as mobile card-based payments solution Cashlez.
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FINSPIRE 2016 is a two-day programme that brings together organisations, startups and individuals from the fintech industry hosted by Mandiri Capital Indonesia and e27 in Jakarta. The first day of the event was at Mandiri Inkubator Bisnis, while the second part is set to be at Soehanna Hall, Energy Building.
The semifinalist of the is set to be announced on Wednesday, followed by a final pitching round that will determine the winner of the IDR200 million (US$15,000) cash prize.
Running a fintech startup in Indonesia
Prior to the presentation, the participants took part in various workshops about the Indonesian fintech market, pitching presentation, and how to run a fintech business.
Rachmat Broto Triadji, SVP of Digital Banking and Consumer Inclusion at Bank Mandiri, spoke about the challenges that banking industry is facing.
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“In the past five years, bank channels continue to evolve. We no longer rely on branches. Branches nowadays are nothing more than residual channels. Back then we can have up to 20 per cent of transaction in branches, now it is no more than six per cent. More than 40 per cent [of transactions] happens in electronic channels,” he explained.
One notable insight was given by Dondi Hananto, Founder of Kinara Indonesia and Unitus Impact.
“Foreigners think Indonesia is a big market, with 230 million population and all … but what’s your actual addressable market?” he questioned.
“You got to be able to really justify that you have a market, and that you can scale it up. And it’s okay to start small,” he continued.
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He also added that for now there is no data that reveals the exact percentage of Indonesians doing transaction online. In addition, there are many alternative partners other than banks that startups can reach out to, such as microfinance institutes or leasing companies.
During the workshop, there was also a discussion about the upcoming fintech guideline by Financial Services Authority. It is very important for startups to be aware of regulations. Hananto took as an example a regulation restricting public fundraising that may directly affect equity crowdfunding platforms.
“Public fundraising is currently limited to 50 investors … making any crowdfunding obsolete,” he said.
First appeared at e27