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Indonesia has witnessed a rapid increase in internet and smartphone usage, leading to greater accessibility and creating a conducive environment for P2P lending platforms to reach a large customer base.


The peer-to-peer (P2P) lending market in Indonesia has experienced significant growth in recent years, driven by various factors. P2P lending platforms, also known as financial technology (FinTech) platforms, provide an alternative financing option for individuals and businesses, particularly those who are underserved by traditional financial institutions. Here is an overview of the Indonesia P2P lending market.


  • Surging Prosperity: The thriving middle class and soaring incomes in Indonesia contribute to the country's upward trajectory, economic growth, better governance, and like giving lending platforms the chance to draw consumers by charging cheap interest rates.
  • Large Unbanked Population in the Philippines: Despite progress, around 44% of Filipinos remain unbanked due to factors like lack of trust, financial literacy, and funds, creating opportunities for digital financial solutions and lending platforms.
  • Rising Demand from SMEs: The increasing number of small and medium-sized enterprises (SMEs), especially those founded by young individuals and women, highlights the need for financial inclusion and access to loans, with P2P lenders catering to the underbanked segment.

1. Surging Prosperity: The Thriving Middle Class and Soaring Incomes.

Indonesia Modalku Annual Profits

Investment opportunities Indonesia Lending Market

Indonesia has seen tremendous progress in poverty reduction over the past couple of decades and, as a result, has made a successful transition from low-income to middle-income country status. As millions have moved out of poverty and extreme poverty, we have also witnessed the rise of Indonesia’s middle class, which now accounts for 20 percent of the total population, or 52 Mn Indonesians. This group important for Indonesia’s upward trajectory, but it still too small for the ambitions of Indonesia. Expanding the middle class will boost economic growth, strengthen an influential constituency for better governance, and creating opportunities for lending platforms to attract customers by offering low interest rates.

2. Large Unbanked Population in Philippines!

P2P lending association Indonesia Lending Market

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According to the latest Bangko Sentral ng Pilipinas (BSP) Financial Inclusion Survey (FIS), The rate of account ownership soared to 56% in 2021 from a mere 29% in 2019. Still, while the Philippine banking industry has made impressive strides in recent years, it’s undeniable that there’s still work to be done. Banking and other digital financial solutions remain untapped opportunities for almost half of the Filipino population.

It’s important to understand why it exists in the first place. Why do 44% of unbanked Filipinos refuse to make the shift? According to World Bank, more than 90 Mn in Indonesia remain unbanked, leaving opportunity for lending platforms to attract customers by offering low interest rates. Some of the reasons are-

  • Lack of Trust in Financial Institutions
  • Lack of Financial Literacy
  • Lack of funds

Lack of funds is another reason many Filipinos still can’t open a bank account. In fact, according to FIS 2021, it’s the top reason a huge percentage of Filipinos are still financially excluded. Almost half (45%) of the unbanked Filipinos cited this as the main challenge to owning a formal account.

3. Rising Demand from Small and medium-sized enterprises (SMEs)

Market competition Indonesia Lending Market

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30% of MSMEs created in 2006 or earlier were founded by people under the age of 35, while 45% of MSMEs in that same period were founded by women. In 2017, these figures rose to 80% and 64%, respectively. Notably, survey results reveal an increase in MSMEs launched in 2017, from 18 in 2016 to 70 in 2017.

Within the unbanked segment, AFTECH reports that there are close to 49 Mn underbanked SMEs, further extending Indonesia’s financial inclusion challenge to individuals and small businesses that are struggling to get loans at reasonable rates from commercial banks, therefore shifting their needs towards P2P Lenders.


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