One of the biggest problems in Indonesia’s tech ecosystem is its payment infrastructure, as 99 percent of transaction volume in the country is still done by cash. Payment gateway players need to give more reason for people to start adopting cashless payment methods, and this is the latest one in store: now you can make offline payments using Ipaymu’s e-wallet in Indonesia.
Liputan6 reported a couple days ago that payment gateway Ipaymu launched a new feature for “gold account” tier members that lets merchants print QR codes that can help them sell goods offline. Users simply scan the QR codes for each product using Ipaymu’s Android app, and pay using their e-wallet account.
(Updated: Silver level merchants can also generate one QR code for their Ipaymu account, but they cannot generate QR codes for each product.)
All the payments using the QR code will be wired to the merchants’ Ipaymu account, which can then be withdrawn from the bank account. Ipaymu is connected to 137 Indonesian banks, PayPal, and can receive money from debit and credit cards.
The Ipaymu team wants to help merchants who do not have an EDC machine to process payments using debit and credit cards. In order to obtain these machines, the sellers must have the necessary business permits in addition to other documents specific to their business’ bank.
(Updated on March 10th: If the merchants don’t have tax identification number (NPWP), they can use their family certificate instead to become a gold member. We revised our view about how difficult it took for merchants to use the new feature.)
Not too friendly for street merchants
Though Ipaymu has leaner requirements than the banks’ EDC machines, there are several obstacles that could prevent sellers from utilizing it.
For one thing, in order to access the gold account tier, merchants first need to present a bank account and tax identification number (NPWP) to the Ipaymu team.
There have only been about 23 million NPWPs issued so far in Indonesia, and the bank account penetration rate is still at 20 percent. Moreover, users need to connect to the internet in order to sign up for the service. The Ipaymu team states that even street merchants can process cashless payments using Ipaymu, but since street vendors typically don’t have access to the all three key ingredients at once (NPWP, bank account, and internet), they probably won’t be using the service anytime soon.
Currently Ipaymu has 18,000 registered users, 40 percent of whom are sellers. The team is positive that they can cross the 20,000 registered user milestone in the next three to six months.
Besides Ipaymu, other e-wallet products in Indonesia are DokuWallet, Telkomsel’s T-Cash, XL Axiata’s XL Tunai, and Indosat’s Dompetku. DokuWallet was just launched in April while the three local telcos allow their e-wallet solutions to send each other money.
(Editing by Josh Horwitz and Terence Lee)