• Ayoconnect

Harnessing the Potential Behind Indonesia's Bill Payment Sector

Diperbarui: Mei 7

Technological innovation support has a very large role in any services development.



The financial technology (fintech) ecosystem in Indonesia is experiencing rapid development. Innovations in the financial services sector driven by the development of fintech in Indonesia are able to encourage financial inclusion, increase Indonesian people's literacy, and have a positive impact on the economic situation triggered by the growth in volume and value of spending transactions.


The growth in transaction volume and value was also experienced by the bill payment industry sector. As one of the types of transactions most frequently carried out by the public, the bill payment sector is an industry with enormous potential.

The Potential Behind the Bill Payment Sector


The amount of potential in this sector is influenced by two factors. First, the very large number of customers includes almost all the population of productive age and adult age in Indonesia, which numbered more than 200 million people in 2020. This demographic segment has the need to pay various types of bills, ranging from electricity bills to BPJS fees. health, credit, internet data packages, education costs, rental and maintenance costs for homes or apartments, and so on.

Second, most bill payments are a type of recurring transaction. Different from several other product categories that are only purchased once in a span of several years, bills such as electricity and water are mandatory needs that must be paid every month. Other bills that are not basic necessities such as cable TV and other entertainment services also tend to have a long subscription period, so the potential for recurring transactions is very high.

This is also supported by the results of internal research conducted by Ayoconnect, a provider of the Open Bill Network, which has more than 3,000 billing products and digital products from 25 categories in its network. Through data taken from the National Socio-Economic Survey (SUSENAS) in March 2020, Ayoconnect found that recurring bill payments contributed to 80% of Indonesia's monthly non-food expenditure. These recurring bill payments consist of housing costs, utility payments such as water, electricity and gas, education, health, insurance, taxes, telecommunications, and so on.

The Support of Digital Technology for Bill Payment Services


In the past, paying bills was something that often took a lot of time and effort, including money wise. This is due to limited bill payment methods and channels and the absence of data integration, resulting in queues snaking up at various locations. Advances in technology and the internet then provide extraordinary breakthroughs that enable various types of bills to be paid anytime and anywhere.

In addition, the Indonesian population also has a high level of internet adoption and digital solutions. Based on a survey by the Indonesian Internet Service Providers Association in 2020, the penetration of internet users in Indonesia has reached more than 196 million people, equivalent to 73.7% of the total population. In another report released by Katadata that same year, two out of three Indonesians from Generation Y have used financial services in a combination of conventional banks, digital wallets, and internet banking.

Supporting this data, research conducted by Jakpat from April to June stated that digital wallets are the most popular payment method for internet users aged 25-35 years. As many as 76% of respondents also use digital wallets to top up their credit and data packages, and 41% of respondents use digital wallets to pay utility bills.


These findings indicate that the support of technological innovation has a very big role in the development of transaction payment services, including bill transactions.


Integration via API as a Bill Payment Industry Solution

The many types and amounts of bill transactions that exist also present their own challenges for billing providers, consumer platforms, and financial institutions. To this date, one of the problems in the bill payment ecosystem in Indonesia is the lack of integration, digitization, and automation between bill providers and companies that provide bill payment services. Integrating via an API (application programming interface) can be a solution to overcome these problems.

"The Ayoconnect Network provides technology-based solutions that integrate multiple billing and digital products in one API," explained Ayoconnect's COO, Chiragh Kirpalani.

The Ayoconnect API allows billing companies - such as telecommunications companies, apartment managers, educational institutions, insurance, and so on - to expand their payment points quickly and seamlessly. On the other hand, companies that have direct contact with customers, such as e-commerce, banks, retail stores, to other fintech applications, can instantly provide their customers with access to 3,000 billing products from 25 categories.

"With an integrated network of billing products and digital products equipped with automation features, Ayoconnect's solutions benefit businesses while increasing consumer transaction convenience," said Chiragh.


The development of the fintech ecosystem in Indonesia is also a part of the growth of the startup ecosystem and technology business in the country. As an information medium as well as an innovation company, DailySocial.id always strives to provide accurate data and research references regarding the development of the industry.

Supported by Ayoconnect, DailySocial.id has published the results of research on the development of the fintech ecosystem in Indonesia in a report titled Fintech Report 2020 which can be downloaded at dly.social/fintechreport2020.



This article was originally published on DailySocial. Arranged by: JuLi Andrian.