Indonesia’s fintech sector is preparing for a new era of growth beyond 2025, driven by government-led modernization, rapid AI adoption, and cross-border integration.

According to the Indonesia Fintech Report 2025, upcoming shifts will redefine how financial institutions, regulators, and businesses operate in an increasingly connected ecosystem.

Key priorities include central bank digital currency (CBDC) expansion, AI integration, data center growth, and cross-border payment connectivity, all aimed at strengthening Indonesia’s digital sovereignty and regional competitiveness.

“These initiatives are positioning Indonesia as a digital finance leader in Southeast Asia,” the report emphasizes.

Cross-Border Payments: Strengthening Regional Connectivity

Bank Indonesia (BI) is spearheading efforts to expand the QRIS network internationally, enabling seamless cross-border transactions.

In 2025, BI rolled out outbound QRIS payments to Japan and launched pilot projects with China’s UnionPay. Discussions are also advancing with India, South Korea, and Saudi Arabia to enhance interoperability between payment systems.

Earlier linkages, such as QRIS, Thai QR (2022), and QRIS–DuitNow with Malaysia (2023), have already proven successful.

The introduction of QRIS Tap, an NFC-based version enabling sub-second transactions, has gained strong momentum since its March 2025 launch, recording 42.9 million transactions from 20.8 million users.

“Cross-border QRIS is a cornerstone of Indonesia’s regional payment connectivity agenda,” the report notes.

Central Bank Digital Currency: The Digital Rupiah Initiative

Indonesia’s central bank digital currency (CBDC), known as the Digital Rupiah, is one of the country’s most significant monetary innovations.

Developed under Project Garuda, it aims to modernize financial infrastructure, strengthen monetary control, and support the digital economy by 2030.

A successful proof-of-concept for the wholesale Digital Rupiah (w-Digital Rupiah) was completed in 2024, demonstrating its use among banks and financial institutions.

The project now enters its intermediate phase, exploring securities ledger use cases before expanding to a retail Digital Rupiah (r-Digital Rupiah) for everyday consumer transactions.

Indonesia is also part of Project Nexus, a Bank for International Settlements (BIS) initiative connecting instant payment systems across countries. The system is expected to go live in 2026.

AI Integration Accelerates Across Financial and Business Sectors

Artificial intelligence is transforming Indonesia’s fintech ecosystem at scale.

More than 80% of Indonesian companies have already integrated AI into operations, with 13% using it at advanced levels, mainly in chatbots, automation, and data analytics.

Generative AI (genAI) adoption is particularly high: 71% of Indonesian professionals used AI tools in 2023, and 21% use them daily, placing Indonesia third globally in genAI utilization.

AI is increasingly applied in fintech credit scoring, fraud detection, and customer support, with firms like Kredit Pintar, Modalku, and BukuWarung leveraging machine learning for risk management and personalization.

“AI is not only enhancing efficiency but also defining how financial services will evolve beyond 2025,” the report highlights.

Indonesia Becomes a Data Center and AI Hub

Indonesia’s digital transformation is supported by massive infrastructure investments from global technology firms.

NVIDIA has committed US$200 million in partnership with Indosat to build an AI center in Surakarta, while Microsoft has pledged US$1.7 billion (2024–2028) for cloud and AI infrastructure, including its first cloud region in Indonesia.

Oracle is also in talks to establish a cloud facility on Batam Island.

These projects aim to meet Indonesia’s data sovereignty requirements and strengthen its position as a regional digital and AI hub.

The government’s emphasis on renewable energy, 207 GW solar and 29 GW geothermal potential, further supports sustainable infrastructure growth.

“By localizing data and building AI capacity, Indonesia is cementing its digital leadership in ASEAN,” the report concludes.

PHOTO: FREEPIK

This article was created with AI assistance.