A customer pays for their purchase using Quick Response Code Indonesian Standard (QRIS) at one of the merchants in Jakarta in May 2022. (B1 Photo/Mohammad Defrizal)

Improving Digital Access and Utilization for SMEs


AUGUST 15, 2022

The latest National Financial Inclusion Survey (2021), a collaboration between the Coordinating Ministry for the Economy and Bank Indonesia, shows a positive trend in Indonesia's financial inclusion. This survey noted that 83.6 percent of Indonesians have access to formal financial products and services (the key indicator of Indonesia's financial inclusion), up from 81.4 percent in the previous year.

Nevertheless, the figures drop significantly if we consider SMEs' utilization of digital technology for business operations, either for marketing, sales, payments, or financing. Only 12-15 percent of small and medium enterprises (SMEs) use digital platforms for marketing their products/services, even though almost half of the consumers use digital platforms as a reference when looking for or buying goods. There is a mismatch between the supply and demand sides here. This shows the urgency to educate our SMEs to use digital platforms to sell their goods/services.

Regarding payment, the cash-on-delivery (COD) method is still the primary preference for Indonesian buyers, especially the lower middle class. On the other hand, only about six percent of people make payments using electronic money. This finding is in line with the BRI Research Institute (BRIRINS) Survey conducted in July 2022, which found that nine out of ten SMEs have not implemented digital payments as an option when making transactions with consumers.

This data shows that public utilization and literacy of the digital economy, especially e-payments, are still very minimal, despite the technology being dubbed as the future of economic transactions. This finding also reinforces the importance of educating the wider community, especially in remote areas and lower-middle income people, to understand and utilize digital technologies for daily transactions.


On the literacy aspect, there is a serious trust issue. Many still assume, doubt, or even fear that digital transactions will harm them. They are wary that what is being offered differs from reality. Also, they fear having their money taken away by the seller.

Consumer protection and law enforcement are the solutions and keys to addressing this issue so that public trust in the digital economy platform will continue to increase. In practice, there is still weak consumer protection on many digital media. If we mirror the advanced countries, consumer protection plays a crucial role in developing digital transactions. Without it, there will be no consumers who want to be involved in digital platforms.

Digital Literacy and Utilisation

Various data, as described previously, show that the literacy and utilization of the digital economy in our society is still minimum. This is where the urgency of training and education for relevant communities, especially SMEs who are not well-literate, use digital platforms for their economic transactions. SMEs must be trained, given proper understandings, and provided with continuous assistance in utilizing digital technology, whether for marketing, payments, or access to finance.

Digital marketing utilization will enable SMEs to target a broader market. The BRIRINS survey (2022) found that around 75 percent of SMEs only sell their products at the local level (district/city). Using digital platforms, they can target other districts/cities and export their products to other countries. Imagine how much increase in sales they can get by utilizing digital platforms.

From the payment side, using digital technology will make it easier for SMEs to record their business transactions in terms of expenses and income. This recording is essential to help SMEs to create basic financial reports so that they can record their business activities and performance, especially crucial data such as sales, best-selling items, sales trends/fluctuations, and capital spent during the production process.

The availability of neat and standardized financial reports has two main benefits. First, SMEs can measure their financial and business conditions based on evidence. This data can then be used as a basis for them to make various strategic decisions regarding the future of their business, whether it is related to expansion, production, marketing, etc.

Second, structured and data-based financial reports will ease SMEs' access to finance. The main challenge in SME financing is financial institutions' limited information (asymmetric information) when assessing prospective debtors' potential and business risks. SMEs often cannot provide the basic financial data needed in this assessment process. With the help of digital technology, SMEs can easily compile their financial reports, which can be done automatically.

As a result, the probability of SMEs accessing finance will be greater. This is an ideal condition and a "win-win" situation for both debtors and creditors. Therefore, access, literacy, and utilization of digital technology must be continuously improved in Indonesia, especially for SMEs, to boost their current performance and upgrade their class.

Dzulfian Syafrian is a senior researcher at BRI Research Institute (BRIRINS). This article is a personal opinion and does not represent the organization.