Indonesia Online Loan and Insurance Industry Outlook


Gurugram, India, September 27, 2021 (GLOBE NEWSWIRE) – While the Indonesian government has taken initiatives for reasons of industrial digitization, education and trade, the country still lags behind other emerging countries in terms of digital adoption. Indonesia is ranked as one of the largest economies in Southeast Asia, where over 60% of the population is unbanked. This proportion of the population is often looking for alternative digital financing options. However, there is still a part of the population that continues to depend on traditional sources of finance (banks and informal channels like friends, family, informal lenders, etc.) sources etc.

Therefore, common ground to traditional and alternative financing solutions has been established with the introduction of online aggregators (commonly referred to as marketplaces). These are price comparison websites that make it easy to compare multiple credit / insurance options from different providers. Backed by a team of trained financial advisors and telemarketers, they provide assistance by suggesting appropriate loan / insurance options to clients based on their needs and meeting eligibility criteria. All of these services are provided free of charge to clients.

So, one wonders where do aggregators make money from? With partnerships established with several banks and insurance companies, online aggregators operate on a commission / fee based system in which the commission rate is decided based on product complexity, regulations and business conditions. ‘OK. CekAja, one of the pioneers in the industry, introduced the concept of online aggregation in 2013. The company started by comparing loan and insurance products and then expanded to investment products in terms of term deposits, unit linked deposits, mutual funds, etc. On CekAja’s model, companies such as Aturduit, KreditGogo, Cermati, Futuready and CekPremi have entered the Indonesian market.

According to the Ken Research publication, Indonesia’s online loan and insurance aggregator market has grown at over 15% annual growth rate. The industry is concentrated among the top 5 players contributing over 90% of industry revenue. In order to stand out from their peers, aggregators have invested heavily in technology, partnership building and product development. Relying on an in-house technology development team, Aggregators work with credit rating companies to perform credit rating and credit checks for unbanked customers. A credit score for these people is established after analyzing several factors, including purchasing habits, history of bill payments, consumption habits, etc. These models help provide credit opportunities to the unbanked population, which would not have been possible otherwise.

Changing lifestyle and spending habits have led to an increase in the traction of microinsurance products with a small premium and limited coverage scope. Sold at affordable prices as low as IDR 10,000, they have been a hit in Indonesia, with OJK registering 22 million policyholders in June 2019 with expansion expected. This has encouraged major insurers to venture into the development of other low premium niche insurance products such as digital device insurance, travel insurance, etc.

The COVID 19 pandemic has created a paradigm shift in consumer behavior with nearly 8 in 10 people now preferring online services. As people suffer from pay cuts, layoffs, small business closings, there has been an increase in demand for short term loans and credit cards. The increase in applications would have created a high growth opportunity in the industry. However, given the uncertain circumstances and the fear of NP loans, banks and aggregators have been very cautious in extending credit to new customers. But in the long run, the pandemic will act as an inflection point in demand for online aggregators and can be expected to be permanent.

Online aggregation services are considered to be a highly scalable business, which makes it possible to expand operations to other socio-demographically similar Southeast Asian countries (Philippines, Singapore, Malaysia) may be the first path to diversification. Second, customers prefer existing providers over trying new ones (especially for financial products), which creates a high potential for cross-selling for other services. Taking advantage of the established client database and advisory services, aggregators should strive to extend platform services to peer-to-peer lending and wealth management.

Covered companies:

  • Cermati
  • CekAja
  • CekPremi
  • To come up
  • Aturduit
  • KreditGogo
  • GoBear
  • Searcher

Period captured in the report: –

  • Historic period: 2015-2019
  • Forecast period: 2020-2024

Key topics covered in the report: –

  • Socio-demographic, economic, banking and fintech scenario in Indonesia
  • Insurance scenario in Indonesia with segmentation by insurance type including auto insurance, health insurance and life insurance
  • A lending scenario in Indonesia with segmentation by loan to government, private (individuals, NBFI, NFI) and others
  • Household / retail lending scenario with segmentation by general purpose loans, mortgages, credit cards, auto loans, MSME loans, home appliance loans and others
  • Gaps in the traditional lending sector filled by online loan aggregators
  • Indonesia Online Loan Aggregator Industry with Tracked Revenue Models
  • End-to-end customer journey followed
  • Technological and organizational structure followed
  • Regulatory landscape
  • Competitive landscape comprising an overview, ecosystem and cross-comparison between major players based on operational, loan / insurance characteristics, product portfolio and website functionality
  • Company Profiles – Cermati, CekAja, CekPremi, Aturduit, Futuready and KreditGogo
  • International Case Studies – PaisaBazaar & PolicyBazaar (India)
  • Future prospects for loans and insurance and online aggregators
  • Impact of COVID 19

For more information on the research report, see the link below:
Indonesia Online Loan and Insurance Industry Outlook to 2024: Driving Incumbents to Continue Growth Through Product Development and International Expansion

Associated reports
India Web Insurance Aggregator Outlook to 2024 – Challenging Incumbent Insurance Product Distribution Channels
India’s insurance GWP collection reached USD 97.4 billion in FY2019, bringing insurance penetration to 3.7%, lagging most emerging Asian economies with around 5.6% penetration. The growth is mainly driven by non-life insurance products including auto and health due to government led initiatives in terms of amending the Motor Vehicle Law, 2019.

UAE Online Insurance Industry Outlook to 2024 – Driven by Customer Enrollment, Ease of Building and Renewing Insurance Policies with Insurance Aggregators
UAE Online Insurance Industry Outlook to 2024 – Driven by Customer Enrollment, Ease of Use of Renewal and Renewal Policies with Insurance Aggregators, Undertakes Comprehensive Analysis of insurance industry in UAE, insurance purchasing models of products among the population, traditional distribution channels, including brokers, banks, agents, direct channels, etc.

Singapore Auto Finance Market Outlook to 2025 – Driven by Green Auto Lending, Growing Digital Advancements, and Growing Number of Financial Aggregators

Singapore auto finance market has been observed to be growing in the period 2015-2020 due to increasing digital advancements to facilitate loan application process, emerging green auto loans, introduction of ‘Funding aggregators and more. Singapore’s auto finance industry grew at a CAGR of 0.7% based on disbursed auto credit and 2.2% based on outstanding auto loans in 2015-20. The CAGR was relatively low due to the lower number of cars funded in 2020 due to COVID-19. In 2020, on average, 85-90% of vehicles sold in Singapore were financed, with around ~ 65% of the cost share. borrowed from automotive financial institutions.

Contact us:-
Ken Research
Ankur Gupta
Marketing & Communication Manager
[email protected]
+ 91-9015378249


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