How to improve payment experience and retention in the Indonesian market?

Improving payment experience and retention in the Indonesian market requires optimising for the unique local financial environment, user habits and regulatory policies. Here are the key strategies:

I. Integration of localised payment methods

1. Full coverage of mainstream e-wallets: Support GoPay, OVO, DANA, etc. (accounting for more than 60% of Indonesia's digital transactions) to ensure deep API integration and reduce jump loss.
2. Bank transfer optimisation: Virtual accounts such as Mandiri/SHOPE Pay are required to enable automatic notification of write-offs, shortening the traditional 3-hour arrival time to real-time confirmation.
3. Convenience store cash payments: Collaboration with Alfamart/Indomaret to generate barcode payments to address the pain points of unbanked card users (35% of the population).

II. Upgrading the technology layer experience

1. Intelligent Routing Reduces Costs and Increases Efficiency::
   • Dynamic channel selection based on transaction amount (0.51 TP3T for small amounts via e-wallet, 0.31 TP3T for large amounts via bank transfer)
   • Failed transactions are automatically switched to the alternate channel and the original order number is retained.
2. Anti-fraud balancing strategy::
   • No OTP verification for <$50 transactions (22% conversion rate increase)
   • Adoption of biometrics as an alternative to SMS verification (smartphone penetration in Indonesia reaches 73%)

III. User incentive system design

1. Tiered subsidy mechanism::
   | User Types | First Order Incentive | Repurchase Incentive | VIP Privileges |
   |—|—|—|—|
   |New Users|$5k off $20k|3%|N/A| on next order
   |Low Frequency Users|Push Limited Time Free Voucher|3 Consecutive Transactions Free E-Coupon|N/A|
   |High Frequency Users|N/A|Double Points on the 8th of every month|Dedicated Customer Service|

2. social fission game::
   Development of "Invite friends to top up and get 10k rupiah each" function, combined with WhatsApp share button (Indonesia WA usage rate 98%)

IV. Compliance and Risk Control Enhancement

1. BPJ Certification Preprocessing::
   Pre-checking of taxpayer number in KYC session to avoid interception of large transactions (more than 2 million rupiahs need to be reported)
   2.Multi-language customer service coverage

• Sundanese/Javanese Language Support Reduces 15% Complaint Rate

V. Data-driven iterative mechanisms
Create real-time monitoring dashboards to track core metrics.

• Failed payment recovery rate (industry benchmark: >45%)
• Cash-to-digital conversion rate (leading platform up to 28%)

Typical case: A cross-border e-commerce company after accessing DOKU aggregation gateway.

• COD conversion rate from 19% → 34%
  -30 Day Repurchase Rate Increase 41%

Special attention should be paid to the fact that new foreign exchange settlement rules will be implemented in BI from Q2 2024, and it is recommended to open a local fund custodian account in advance.

VI. Scenario-based payment experience optimisation

1. Phased payment (BNPL) penetration

• Co-operation with local BNPL service providers (e.g. Kredivo, Akulaku)The company offers 0% interest instalments for high unit price categories (3C, home appliances), which can increase the unit price by 30%+.
• Adjustment of risk control strategy: Limit the amount of first-time BNPL users (≤ Rp 2 million), and gradually increase the amount after good repurchase.

2. Customised social e-commerce programmes

• TikTok Shop/WhatsApp Commerce Integration: Development of "in-chat quick payment" feature to reduce bounce rate
• Automatic settlement of commission for group leaders: T+1 auto-payment to e-wallet for community group purchase model

VII. Offline Scene Coverage Strategy

VIII. Precise recall of lost users

1. Intelligent Layered Reach::
   • "Abandoned users": GoPay cash vouchers pushed within 2 hours (conversion rate increased by 18%)
   • "Sleeping Users": limited-time free cash-out coupons issued in the first week of each month
2. Religious Holiday Marketing::
   Launch of 'Hari Raya Cashback' ahead of Eid with a gift box for every purchase made

IX. Redundant construction of bank corridors
RecommendedDual channel hot standby solution::

graph TD

A[transaction request] --> B{amount <500k?}

B --> |Yes| C [Priority routing to e-wallet]

B --> |No| D [go through direct bank connection channel]

C --> E[Failed?] --> F [Automatic switching of DOKU alternate gateway]

D --> G[failure?] --> H [trigger BCA line fallback]

X. Preparation for regulatory sandbox testing
OJK to be piloted in 2024Cross-border QR code interoperabilityAdvance placement is recommended.

1. QRIS Compatibility Test with SGQR/GPN
2. Pre-study of interconnectivity of regional wallets such as GrabPay

Key data objectives.

• Compressed average payment length from 4.7 minutes to <90 seconds
• COD rejection rate controlled below 8% (current industry average 12%)

The next step could be to focus on breakthroughsIslamic Finance Compliance Certification(e.g. Sharia-compliant escrow) to capture the incremental market of traditional Muslim merchants. Is there a need to embark on an implementation programme for a specific segment?