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Through a joint venture with Salim Group, Liquid expects to secure up to 500,000 users

Japanese tech company Liquid announced on Thursday the launch of its fingerprint-based payment service in Indonesia, its third overseas market after Sri Lanka and the Philippines, according to a report by Bangkok Post.

Liquid’s fingerprint authentification system is said to be able to complete payments within three seconds, with the company claiming the error rate to be one in a trillion.

The service was launched through a joint venture with local conglomerate Salim Group, which was set up in November 2016. The company plans to first offer the service to Salim Group’s work force of 500,000 employees, and the system will be installed on Salim Group’s stores later this year, though Liquid will start registering fingerprints and deposit money this month.

“We are looking forward to developing the next generation payment and business platform in Indonesia, which will contribute to changing people’s lifestyle and have a big business impact in Indonesia,” said Liquid CEO Yasuhiro Kuda.

Also Read: The gig economy is on the rise in Asia, and it drives fintech for SMEs

A tough market for fintech companies

The announcement came at a great timing as the Indonesian government through its central bank Bank Indonesia (BI) just announced that it is going to re-open registration for online payments service licence, particularly for digital wallets and payment gateway services.

DailySocial reported that BI has begun to spread around a survey for licencing “readiness”, and has set up Friday as the deadline for fintech companies to submit the survey.

Since the licencing regulation was introduced in 2009, only 21 companies have managed to secure the licence with the majority of them being banking and telco companies.

Apart from regulation issue, Indonesia is generally seen as a highly potential but tough market for fintech services. The country has been known to have relatively low number of bank account ownership among its citizens, with the World Bank revealing in 2014 only 36 per cent of people aged 15 and beyond have an account at formal banking institutions. Naturally, the number is followed by low penetration rate for credit cards, with only 14.5 million (out of 280 million) citizens owning a credit card.

This is the reason why the use of cash remains heavy even among e-commerce services in the country, as MasterCard Advisors stated cashless payments account for only 31 per cent of the total value of consumer payments.

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