In order to advance inclusive finance, LinkAja is willing to work with any platform or institution that is consistent with its goals.
Edit: Yu Meng
Editor’s note: The author of this article Khamila Mulia , This article is from English station KrASIA, Original title:LinkAja CEO Danu Wicaksana: Ready to be The biggest mobile payment platform in Indonesia
Going to the sea (ID: wow36krchuhai) Summary points:
LinkAja’s goal is not to dominate the entire market, and is very willing to work with other digital payment platforms
Unlike platforms that focus more on user lifestyles, LinkAja is positioned to address the full range of user needs
LinkAja focuses on core usage scenarios and doesn’t grow business with crazy money like startups
LinkAja wants to make it available to all Indonesian citizensEnjoy financial services | Image source: IC photo
The Indonesian state-owned e-money platform LinkAja was launched in June 2019 with the mission of implementing the “National Cashless Campaign” initiated by the Indonesian government. The campaign aims to make the public aware of the benefits of using non-cash payments and to make financial services available to all Indonesians.
LinkAja integrates existing electronic payment services from Indonesian state-owned companies, including e-cash from Bank Mandiri, T-Bank and My QR from the People’s Bank of Indonesia (BRI), and National Bank of Indonesia (BNI) YAP! And UnikQu, as well as TCash from Telkomsel. As a newcomer to digital payments, LinkAja will compete with many players in the market, including the leaders in the field, Go-Pay and Ovo, which are competitive in providing payment services for car services.
However, LinkAja, which is supported by many state-owned companies, also has its own competitive advantage. The platform plans to integrate all public transport operators, including companies operating intercity trains, MRT, light rail rapid transit, and road toll management company Jasa Marga. The data shows that in June 2018, only the intercity route commuter trains transported 1 million passengers per day, which brought a large number of potential customers to LinkAja.
Despite this, CEO Danu Wicaksana denied that LinkAja’s goal is to dominate the market. Instead, he is very willing to work with other digital payment platforms. It seems that he is indeed keeping his promise. Shortly after the release of , LinkAja announced a strategic partnership with Go-Jek. Go-Jek’s ecosystem of business services will include LinkAja as a payment option. This unexpected collaboration has been welcomed by two platform users. LinkAja claims to have 22 million registered users, and the company hopes to double its registered users to 44 million by the end of the year.
Going to the sea (ID:wow36krchuhai) Recommended reading: English station KrASIA a>Recently met with LinkAja CEO Danu Wicaksana to discuss his strategies for achieving this ambitious goal.
KrASIA(Kr): Why did LinkAja’s release be postponed three times?
Danu Wicaksana (DW): The company started operations in March, and we only have 6 weeks to integrate all state-owned e-money products, which will inevitably require a lot of adjustments and improvements. We originally planned to release LinkAja after March, but the presidential election is about to begin, and our shareholders hope to hold a 100,000-person conference, but we are not licensed because of the conflict with the campaign season.
So we have to postpone it and we plan to find a time to post it after the election. However, because of a series of protests in Jakarta, the situation is still unstable, so we have to postpone the press conference again after the Eid al-Fitr holiday. The extension is for security reasons only, not as some people think, because of bureaucracy or institutional problems.
Kr: Many people predict that LinkAja is backed by state-owned companies that are prevalent in bureaucracy, so it is difficult to fight against flexible competitors. Is this kind of worry necessary?
DW: I can understand this idea because half of our team is from TCash from Indonesia Telecom. But according to my personal experience, private companies can’t always expand as fast as expected, and the development of companies with government backgrounds is not necessarily slow. We need experience in the mobile payment space, which is why TCash merges with other e-money platforms. Because half of the LinkAja team is from TCash and the rest of the colleagues are recruited by professionals (such as our IT team), our shareholders don’t have much intervention on LinkAja’s business. I canAnyone with this concern guarantees that LinkAja will never have the bureaucracy of the past.
Kr: What is the difference between LinkAja and competitors?
DW: Unlike platforms that focus more on the user’s lifestyle, LinkAja is positioned to address the full range of user needs. Our main focus is on eight commercial transactions, including public transportation, refueling and tolls, online loans, bill payments, retailers, e-commerce, donations, remittances, and financial services including loans.
We are not planning to grab the existing market share. Because LinkAja’s target market is different from other platforms, in addition to targeting the middle class, we will also serve low- and middle-income groups who have never received digital financial services. For example, LinkAja can help monitor its distribution process for subsidizing LPG to low-income groups. In real life, many middle class and even food hawkers use such liquefied petroleum gas. The failure to implement the subsidy policy not only damages the image of the government, but also hinders those who really need it. We can use the data saved by LinkAja to ensure that only low-income groups can purchase subsidized LPG through the platform.
Kr: How do you plan to achieve the goal of 44 million users?
DW: We don’t develop business like crazy startups like crazy startups. Instead, we focus more on core usage scenarios, continually improve our technical capabilities and partnerships, and continue to innovate and ultimately provide our customers with Diverse services.
For example, we are working with Jasa Marga, a state-run road toll company, to test a no-character fee payment system using radio frequency identification (RFID), which is attached to the lid of a car’s headlights in the form of a sticker. In the early stages, users only need to download an app called Flo and then recharge the points via LinkAja. We hope to implement the entire process through the LinkAja application. At present, 20 toll stations have installed RFID scanners, and we hope that at least 200 toll stations will run the system by the end of this year.
Kr: Does LinkAja provide a lending facility?
DW: Since we have not yet obtained a permit from the Indonesian Financial Supervisory Authority OJK, we will not participate in the lending business ourselves.In addition, it only provides a platform for online lenders such as Kredit, Pintar and TrustIQ. Users can apply for a personal loan on LinkAja, after which the process will be carried out in our partner’s system.
In addition to online lending, we also offer other financial services, including a payroll system for our B2B customers. Indonesia also has a large number of informal employees and regular staff who receive cash and cash. This salary payment model is very inconvenient and unsafe. In fact, most people in Indonesia have mobile phones, and we can pay them through our platform, which will bring convenience to employees and businesses.
Our other core services include cashless withdrawals for more than 40 ATMs on the Link network, as well as working with Indonesian migrant workers in Singapore through partnership with Singaporean Telecom (Single) Remittance service.
These services reflect our vision of inclusive finance for all. With LinkAja, people who don’t even have a bank account can do digital trading on our platform.
Kr: Is there more about LinkAja working with SingTel?
DW: In addition to remittance services, we are also working with the company to promote LinkAja users to cross-border payments in Singapore via Singapore Telecom’s roaming network. This way, LinkAja users can trade with any merchant via QR code. This service is in line with the Indonesian Standard QR Code (QRIS) planned by the Bank of Indonesia in the second half of 2019. With this plan, each merchant can use the same QR code to connect to different payment system providers.
LinkAja is the first digital platform to apply QRIS abroad, which makes us proud. Because the QR code we use is the same as the international standard for QR code developed by the International Chip Card and Payment Technology Standards Organization (EMV), just like Singapore and Thailand. We are also preparing to launch this service in Thailand in the future.
Kr: WeChat Payments and Alipay are working with LinkAja’s two shareholders, the National Bank of Indonesia and the People’s Bank of Indonesia, will LinkAja work with the two Chinese platforms?
DW: LinkAja does not have any plans to work with WeChat Pay and Alipay, but according to the regulations of the Bank of Indonesia, our two shareholders are indeed their partners in Indonesia. However, WeChat payment and Alipay can only be made in IndonesiaUsed by Chinese citizens. After the transaction, the bank they choose to cooperate with will process the settlement in order to pay the transaction record in the domestic payment system.
Kr: How do you think LinkAja will develop in the future?
DW: We are very optimistic about the future development of LinkAja. Our goal with the company’s shareholders is to achieve profitability within four years. In addition, we are not worried about competition at all, because LinkAja’s main task is to provide financial services to all Indonesians, so we are willing to cooperate with any platform or organization that has the same goal.