How digital payments are accepted in a small city in Indonesia

Previously, I have written about how telemedicine looks like in my hometown. It was very different from what I have been experiencing in Jakarta.

This was the first time I went back to my hometown in East Java province, more than 750 kilometres away from Jakarta. Nobody seems to bother providing the latest population stats – but should be no more than 200,000 inhabitants. 

Surprisingly, I found out that merchants, including the new ones from various franchises, now accept many payment methods. 

So here’s what I have found during my grocery shopping trips:

Various EDC (electronic data capture) machines are available at the points of sale.

I found these below:

Honestly, this should have been simplified by Gerbang Pembayaran Nasional (GPN) or National Payment Gateway. Which means, only 1 machine supports all credit and debit card payments.

Nonetheless, the current landscape is good for the terminal manufacturers, the biggest of which I think is Sunmi, which is affiliated to Xiaomi. 

Also, you can clearly see the Visa paywave logo in the picture above, right? Unfortunately, when I asked them if I could use it to pay for my groceries, they had no idea how to use it. Thus, they used the “common” way, inserting my card on the machine. 

The country’s credit card penetration is below 5%, according to various statistics, while debit card is higher. I wonder how many would already have NFC-equipped VISA cards in my humble town.

QRIS are adopted

QRIS stands for QR Code Indonesian Standard, launched by Bank Central of Indonesia in 2019 and widely adopted starting in 2020. QR Code payment was popularized by Gopay and OVO with their closed loop system.

Closed loop means that e-wallet users are only allowed to transact at merchants (providers of goods / services) who are also the issuers of the electronic money. But now that QRIS is here, customers can pay with any method – effectively creating a settlement network for interoperability. This time, I used my BCA m-banking to pay.

Shopee Pay doesn’t want to be left behind, indeed

And just outside the supermarket I used to go for groceries, you can see this Shopee Pay banner.

And smaller food stalls also offer Shopee Pay as a payment method.

And I found this on small bakery stall in train station:

Even though it’s slow – yes, I saw people pay Grab with cash in my hometown and I frequently charged 1% if I use a debit card to pay-, it’s fascinating how people start to adopt digitalization outside the major cities. 

This city used to have no options but cash not long ago. 

Now who says Indonesia is all about Jakarta?