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Home Banking Financial Services and Insurance Future Growth Of Indonesia Loan and Insurance Industry: Ken Research

Future Growth Of Indonesia Loan and Insurance Industry: Ken Research

Socio-Economic Outlook Of Indonesia

Indonesia is the 4th most populous country (270.6 Mn) in the world holds high potential for economic growth with >60% of its population lying in the working-age group. Easy & affordable internet accessibility has been driving the country’s preference for online platforms for shopping, bill payments, banking services, etc.

Owing to limited financial infrastructure & less financial awareness, ~60 of the population remains unbanked; therefore are often looking for alternative financial solutions. This has led to the growth of the fintech industry in the country with over 170 players operating as of 31st December 2019.


In 2019, the country experienced its weakest economic growth since 2015 owing to a fall in its second-largest GDP contributor i.e. exports & international investments. The country’s economy is highly dependent on production from MSMEs (~60% contribution to GDP in 2018) therefore multiple government initiatives like “MSME Go Online” have been taken for their digital transformations & overall development.

Key Indicators

Household Consumption Expenditure grew at the rate of 8.4% in 2019, underpinned by increasing population & declining inflation rate

Declining BI rate (Policy Rate) has helped in increasing the country’s lending further helping in economic development

Overview Of Banking & Fintech Industry In Indonesia

~70% of the Indonesian population still suffers from credit inaccessibility due to limited banking reach & preference towards high creditworthy individuals. Solving this, we see many upcoming online lending platforms such as Crowdo, Modalku, Cashwagon, etc. Leveraging their technology & increasing popularity banks like BNI, Bank Mandiri, etc are partnering with fintech players to further increase their reach & services.

Overview Of Insurance Sector In Indonesia

GWP collected in Indonesia for the year 2019 stood at IDR 179 Tn driven by growth in Motor & Health Insurance. In comparison to other countries, Indonesia lags behind with a penetration rate of just 2.9%. Relying on traditional methods Bancassurance continues to be the preferred choice among customers. Microinsurance products have been gaining traction, provided with smaller premium packages (~IDR 10-50,000) & limited coverage.

Household/Retail Lending Scenario In Indonesia

Driven by demand for Mortgage loans, multipurpose loans & SME loans, Household Credit in Indonesia has been recording a Y-o-Y growth of more than 5%. With the majority of the population located in urban areas, demand for retail loans was seen to be concentrated in areas of Java, Sumatra & Sulawesi.

Indonesia Online Loan & Insurance Aggregator Industry

Customer Journey: 7 step process starting from a customer visiting the website & choosing the suitable option with help of multiple filtering & sorting options to the customer receiving loan amount/insurance policy. After-sales support is also provided in form of claim assistance, renewal notifications & suggestions for other suitable products.

Revenue Model: Prevalence of three revenue models including Fixed Fee per product (mostly used for credit cards), Commission Earning (Insurance, Loan Products) & Guarantee based Reward. Guarantee based Reward is opted for by aggregators in certain cases only.

Organizational Structure: With an average employee base of 200 employees, ~60% of people employed in the Telesales department to drive sales & provide assistance for loan & insurance products.

Technology Stack: In-house developed website incorporating AI & ML models to segregate customers & suggesting suitable options depending on the customer’s needs & background. CRM software including calling software, automated email generators, Plugin/APIs acquired from third-party vendors to fetch customer background, ease online documentation process, etc.

Marketing Strategies: Online Marketing campaign is observed to be the most preferred & effective marketing strategy producing up to 50% revenue growth & generating ~leads per product. Other preferred marketing sources include blogs, offline banners, agent-led distribution, discounts/offers, etc.

Regulatory Landscape: Governed by OJK & Bank of Indonesia, registration process completed with 30 days of submitting the application with the required documents. Aggregators are required to also follow governance & reporting guidelines as prescribed by OJK Indonesia. For example, Providers are required to regularly submit their Performance reports, Self-Assessment Report& Consumer related information (like an investment, returns, portfolio details, etc) to the Financial Services Authority.

Competitive Landscape Of Aggregators

Growing at the rate of > 15%, the industry is concentrated among top players including Cermati, CekAja, Futuready, CekPremi, Aturduit competing on the basis of Traffic Generated, Exclusive Partnerships with Service Providers, After Sales Processes/Assistance, discounts & offers provided, etc. While some of the players have expanded to segments of Wealth Management and P2P lending to become a one-stop solution provider, others are considering taking up expansionary plans in coming years.

Future Outlook Of Indonesia Loan & Insurance Industry

Owing to the economic shock brought in by COVID 19, the demand for loan & insurance products are expected to witness tepid growth during 2019-2020. With the given rise in unemployment & salary cuts, demand for short term loans & credit cards increases as people’s reliance on them increases for paying their utility bills.

COVID has also made Indonesian people realize the importance of health insurance as many struggle to pay their hospital bills. Insurance providers have been investing in the development of other niche insurance segments like pet insurance, electronic device insurance, etc. Upcoming product innovations aimed at becoming microinsurance depict high potential for the insurance industry in Indonesia.

Outlook Of Online Loan & Insurance Aggregators In Indonesia

COVID 19 outbreak expected to bring in major lifestyle changes making consumers prefer contactless services thereby creating a high potential for online loan& insurance aggregation services.

Analysts at Ken Research estimate that as a part of expansionary plans, major players are expected to diversify more in providing customized solutions, increasing the role of AI & ML in customer segregations & advisory services & the development of new products.

Companies Covered: –









Time Period Captured in the Report: –

Historical Period: 2015–2019

Forecast Period: 2020-2024

Key Topics Covered in the Report: –

Socio-Demographic, Economic, Banking & Fintech Scenario in Indonesia

Insurance Scenario in Indonesia with segmentation by Insurance type including Motor Insurance, Health Insurance & Life Insurance

The lending scenario in Indonesia with segmentation by Loan to Government, private (Individuals, NBFIs, NFIs) and Others

Household/Retail Lending Scenario with Segmentation by Multipurpose Loans, Mortgage Loans, Credit Cards, Auto Loans, Loans to MSMEs, Home Appliance Loans & Others

Gaps in Traditional Loan Industry fulfilled by Online Loan Aggregators

Online Loan Aggregator Industry in Indonesia with Revenue Models followed

End-to-End Customer Journey followed

Technological & Organizational Structure followed

Regulatory Landscape

Competitive Landscape including Overview, Ecosystem & Cross Comparison among major players on basis of Operational, Loan/Insurance Providers, Product Portfolio and Website Features

Company Profiles- Cermati, CekAja, CekPremi, Aturduit, Futuready & KreditGogo

International Case Studies-PaisaBazaar& PolicyBazaar (India)

Future Outlook of Loans and Insurance & Online Aggregators

Impact of COVID 19

For More Information on the Research Report, refer to the below links: –

Indonesia Online Loan Aggregator Industry

Related Reports by Ken Research: –

India Online Loans Market Outlook to 2019 – Industry Transformation by the Advent of Web Aggregators

UAE Online Loan Aggregator Industry Outlook to 2024 – Driven by Shifting to Contactless Services & Easy Online Loan Facilitation

Contact Us: –

Ken Research

Ankur Gupta, Head Marketing & Communications



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