Fintech
The Industrial Revolution 4.0 has brought significant advances in digital technology including the emergence of digital financial technology or financial technology (fintech).
According to the Chief Executive of the Capital Market Supervisory Financial Services Authority (OJK) who also serves as chairman of the Indonesian Bachelor of Economics Association (ISEI) Jakarta Inarno Djajadi, fintech has offered innovative financial solutions that are transforming the way people manage their finances.
By utilizing technologies such as the internet, mobile computing, cloud computing, big data, block chain, and artificial intelligence (AI), fintech is able to deliver financial services better, faster, and cheaper.
This of course increases the efficiency, effectiveness and range of services as well as creating financial products and services that are more inclusive and in accordance with the needs of the community. In Indonesia, the development of fintech is increasingly supported by the increasing use of digital technology by the community.
Based on the results of the Indonesian internet penetration survey in 2024 released by the Indonesian Internet Service Providers Association (APJII), Indonesia’s internet penetration rate has reached 79.5 percent or equivalent to 221.5 million internet users from a total population of 278.7 million people.
This development is reflected in the value of Indonesia’s digital economy which reached 77 billion US dollars in 2022 and is expected to reach 130 billion US dollars in 2025.
Especially for crypto assets, products that are icons of the digital financial asset ecosystem, have shown exponential development since their emergence in 2008.
Until April 2024,the value of crypto asset transactions reached Rp211.10 trillion with a total of 20.16 million registered customers. The highest transaction value ever reached Rp859.4 trillion in 2021.
In line with these developments, the Indonesian government shows a strong commitment to supporting the development of fintech by developing and strengthening the national digital financial ecosystem.
This is stated in the vision of Indonesia Digital 2045 which is supported by three main pillars, namely digital Government, digital Economy, and also digital society which is supported by the main foundation of digital infrastructure and a strong national digital ecosystem.
The government, OJK, and stakeholders also continue to improve financial literacy and education to support the development of the digital economy.
The implementation of financial education in order to improve the financial literacy of the community is very necessary because based on a survey conducted by the OJK in 2022, the financial literacy index of the Indonesian population is 49.68 percent, up from 2013, 2016, and 2019 which were only 21.84 percent, 29.70 percent, and 38.03 percent, respectively.
Financial literacy is the knowledge, skills, and beliefs that influence attitudes and behaviors to improve the quality of financial decision-making and management to achieve the financial well-being of society.
Through financial literacy and education, the wider community is expected to determine financial products and services that suit their needs. The public must properly understand the benefits and risks, know the rights and obligations and believe that the financial products and services chosen can improve the welfare of the community.
By optimizing digital development and demographic bonuses coupled with synergies between stakeholders, strengthening infrastructure, increasing domestic investment attractiveness, developing credible human resources and policies, as well as financial literacy and education, Indonesia will undoubtedly be able to accelerate the development of the digital economy as a whole.
In turn, Indonesia is able to reap greater benefits from the development of the digital economy in order to achieve the vision of becoming a developed and prosperous country.