B2B Payments

Indonesia Likely To Implement Flat Rates For Digital Wallet Payments

Indonesia is planning to implement flat-rate fees for certain digital wallet transactions, Reuters reported on Monday (Dec. 30), citing five sources.

Fees are presently adjusted according to the type of vendor, with larger merchants paying more to offset costs for small shops. Bank Indonesia is proposing a possible 0.7 percent fee for some eWallet transactions, the sources said, which would end up costing smaller merchants more than they currently pay.

Transaction fees at larger merchants are still being discussed, but could also end up being a flat rate of 0.7 percent. Usually, larger merchants are charged fees ranging from 0.5 percent to 2 percent. By way of comparison, fees at Visa and Mastercard are roughly 2 percent to 3 percent, the article indicated.

In addition, the proposed changes would divide the transaction fees equally among the eWallet companies, middle-men payment processors and the Indonesian lender consortium (the National Electronic Transaction Settlement).

Currently, eWallet companies currently don’t have to share any portion of the transaction fees with lenders.

“This will hurt all of us,” an executive at an Indonesian eWallet firm told Reuters.

More than 50 percent of Indonesia’s population of nearly 270 million people don’t have bank accounts, which has created a multi-billion-dollar digital payments market.

The country’s $40 billion online economy is forecasted to grow three times as big by 2025, according to a report by Google, Temasek and Bain & Co.

In September, Indonesia-based Traveloka created the PayLater card with Bank BRI with the goal of bringing some of Indonesia’s underbanked online by offering exclusive deals across travel, lifestyle and insurance products.

Both online and offline transactions are supported under Visa’s global network, and may also be managed through Traveloka’s mobile app. There are plans to issue five million PayLater cards by 2025.



The PYMNTS Cross-Border Merchant Friction Index analyzes the key friction points experienced by consumers browsing, shopping and paying for purchases on international eCommerce sites. PYMNTS examined the checkout processes of 266 B2B and B2C eCommerce sites across 12 industries and operating from locations across Europe and the United States to provide a comprehensive overview of their checkout offerings.