The complicated lives of Indonesia’s e-wallets

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Hello readers,

Fun fact: Almost half of China’s population uses Alipay – that’s 711 million monthly active users (MAUs). Seeing that astronomical number would make any founder green with envy, and those in fintech startups would start thinking, “Why can’t my startup do that too?”

That’s especially true for those based in Indonesia, as industry experts believe the archipelago will reach China’s penetration rate within the next five years.

So today we look at:

• E-wallets in Indonesia and whether they can break through their stagnation
• When AI comes and takes over
• The startup that feeds you grasshopper snacks

We’re soarin’, flyin’: Can e-wallets in Indonesia break free from low adoption?

Most e-wallets in Indonesia would love to get hit by the e-wallet wave that’s sweeping China. Currently, platforms like Gojek, Ovo, and Dana are seeing an average MAU rate ranging between 2% to 11% of the Indonesian population — a significant difference when compared to Alipay’s penetration rate in China. But industry sources stay bullish about the next five years.

• Right place, right time: Alipay’s timing was impeccable. It was launched during the initial wave of ecommerce and around the time when China was rapidly growing, which allowed the population to have a much higher spending output. As for Indonesia, its GDP per capita is still a lot lower than China’s, making it harder for the population to spend and, consequently, for e-wallets to earn.
• Change is on the way: The Covid-19 pandemic can help accelerate e-wallet adoption in Indonesia. Already, ecommerce apps in the country are seeing a 25% surge in weekly active users. And similar to how shoppers who buy on Alibaba stay on as Alipay consumers, these users might also become frequent e-wallet users in the long run.
• Another lies in wait: Ecommerce is not alone. Two more factors that could push Indonesia’s fintech players to achieve 50% penetration would be servicing micro, small, and medium-sized enterprises (MSMEs) and reaching Indonesian consumers living outside major cities.

Read more: Indonesia’s e-wallets have hit a ceiling – but there’s a way to break it

When AI comes and takes over

This is the stuff dreams — or nightmares — are made of: More companies have an urgent need for artificial intelligence. That means AI could soon replace us humans and knock us off our jobs…or maybe not?

• Hello, world: 85% of companies say that they want to use AI. As more companies move toward that goal, 1.8 million jobs will be eliminated. But at the same time, AI adoption will also create 2.3 million more jobs.
• On the up and up: Jobs that require AI skills have increased 4.5x since 2013. Asia Pacific, in particular, will show the highest compound annual growth rate of 59.5% between 2018 and 2025.
• Dream job?: Jobs in data management and analytics offer pretty good salaries. In Singapore, the median salary ranges from US$48,609 to US$121,534 while in Indonesia, the monthly gross base salary could go up to US$3,355.

Quick bytes

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