The economy growth in developing countries such as Indonesia and India increased in the last decade. Along with that, the development of fintech also increased. Alternative financing is needed to stimulate the economy. In particular, for the micro small and medium enterprises (SMEs). Since there are still many SMEs are having difficulties to gain access to bank, therefore financing models such as financial technology (fintech) is required to reach them.
With the technology supporting real-time transaction, any financial transactions conducted by customers can be instantly switched on and connected to the central office, saving recordkeeping time and employee performance.
When advanced countries like the United States, Britain, Japan and South Korea have long used cashless transactions in their daily activities, some developing countries such as Indonesia and Thailand are still promoting this program.
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When we heard these terms “electronic payment” / “digital money”, there are actually one right term or the right way of how we call it. It’s called e-Money. e-Money is money in digital form that used to perform Digital Payment. The nature of e-Money is a stored value. The meaning of this value is stored owner of the e-Money should deposit a certain amount of money to the vendor of e-Money. Then, the new e-money can be used for digital transactions.
Today’s society has many payment options in conducting financial transactions. With the development of digital money, the popularity of credit cards is now almost in parallel with e-money. This could be a consideration for financial institutions to develop their products, which one is more advantageous – credit card or e-money. Let’s look at both comparisons.
Financial technology – commonly known as Fintech – is actually not a new thing. Since the development in digital technology grew rapidly, finance industry is already starting to get a lot of attention and noting a significant progress. People’s habits in using the Internet, gadgets, and living practically has forced each line of business to consider the development of their technology.
This article has been updated to correctly reflect the development of E-Money in Indonesia, 2019
The use of electronic money in the world expanded rapidly in the last decade. Not only for reasons of practicality, but also considering the security issues related to the social conditions in the society. Electronic money or e-money is now encouraged to be more useful in people’s lives.