JAKARTA: Leading Indonesian e-commerce startups have had to partially suspend e-wallet operations until they are granted a license by the central bank, as the growing popularity of the electronic services attracts greater regulatory scrutiny. These include Tokopedia, which recently announced it will raise $1.1 billion from Alibaba Group Holding and other investors; Shopee, a unit of Singapore-based Sea, which recently filed for an initial public offering in New York; and the popular Bukalapak local platform. “During assessment of the licensing application, related parties are not allowed to offer top-up facilities for their customers,” Pungky Wibowo, the central bank’s director for electronification and financial inclusion, told local reporters. He said Bank Indonesia had to ensure “consumer protection.” Tokopedia and Bukalapak confirmed their customers will still be able to make payments using e-money already stored. “We’ve decided to expand our TokoCash service by submitting the application,” William Tanuwijaya, Tokopedia’s chief executive, told the Nikkei Asian Review. “We’re planning to allow the use of TokoCash outside the Tokopedia platform,” he said. Tokopedia is reportedly planning to facilitate payment of U.S. ride-hailing app Uber with TokoCash. Tanuwijaya said TokoCash has received “very positive” responses from customers since its launch in March. People can purchase items and pay a variety of bills with it, and bypass more common but lengthier procedures that use automated teller machines. Credit cards continue to be unpopular with Indonesians.
Bukalapak hopes that once it gains a license its customers will feel comfortable storing up to 10 million rupiah ($741) — the legal limit — in their BukaDompet e-wallets. Shopee declined to comment. Only a tiny fraction of transactions use e-money at present, but the system has seen double-digit growth in the last few years. By August, e-money transactions had already reached 6.6 trillion rupiah — 94% of 2016’s figure, according to Bank Indonesia. Previously only available through prepaid cards issued by major banks, e-money has increasingly become available in mobile accounts run by telecommunication companies, and lately in virtual wallets provided by online taxi services and e-commerce sites. According to Bank Indonesia regulations, companies must obtain a license when they have 300,000 users, or if the business has turned over more than 1 billion rupiah ($74,000). Many companies have no no licenses because the regulatory details are so new and still evolving.
