Singapore fintech startup makes inroads in Indonesia

Singapore

LOOKING at the number of people in several countries who still lack access to banking facilities, Singaporean entrepreneur Abu Bakar Mohd Nor saw the opportunity to provide electronic payment services and formed Fin (SE) Asia to serve the region.

The fintech recently partnered Indonesia's largest Islamic organisation, Nahdlatul Ulama (NU), through Indonesian payment gateway company PT Nusantara NUCash Utama to penetrate South-east Asia's largest economy.

Fintech is a fast-growing industry in the world as cashless payments and connectivity are becoming increasingly important, driven in large part by the ongoing Covid-19 pandemic.

"Cashless payments are expected to become a way of life, and the first country that we want to penetrate is Indonesia before moving on to other regions such as the Middle East," said Abu Bakar, 55, who is also the company's executive chairman.

He also owns and chairs several other firms such as cloud company InfoFabrica; 3D geospatial company Vizzio Technologies; and e-commerce company MiPlanets. Before setting up his own businesses, he was the managing director (gas and specialised vessels) of Keppel Offshore & Marine.

He is also currently the deputy president of the Singapore Malay Chamber of Commerce and Industry.

Many fintech firms around the world are growing rapidly, and have managed to raise substantial funds from venture capital (VC) providers.

Indonesian e-commerce giant Bukalapak, for example, has formed a fintech unit called Buka Investasi Bersama, and partnered Standard Chartered to offer digital banking offerings. Fintech firm Payfazz raised US$53 million in July last year from VCs.

Sharing about his partnership with NU, Abu Bakar said: "NU has 90 million members in Indonesia and 100 million outside Indonesia. We are happy to work with our business partners to penetrate that huge market."

Explaining the online market in Indonesia, Abu Bakar said electronic transactions reached US$13.95 billion and is expected to grow 33.1 per cent this year.

Furthermore, over 74 per cent of the population have access to the internet, with almost all of them - 95.4 per cent - accessing the Internet through their smartphones.

"This shows that IT (information technology) literacy is very high. We think there is an opportunity to push them towards a digital lifestyle. Penetration in e-commerce that allows them to buy online is also very high," he added.

Therefore, the trend of using electronic wallets is also becoming more significant in Indonesia.

"Our challenge is to expand digital banking services so that it becomes a lifestyle," said Abu Bakar.

He said that collaboration with NU would accelerate Fin (SE) Asia's presence in Indonesia.

By using fintech, other outreach efforts can be implemented such as in education and health technology.

"We hope our efforts can improve the lives of the people in Indonesia. It can connect with one another and empower them so that their lives can be better through the digital economy,'' he said.

• The writer is assistant to the editor at Berita Harian. This is a translated version of an article first published in BH on Oct 3.