Facebook has been negotiating business deals with Indonesia's booming e-payment businesses whose revenues are expected to grow nine-fold in the next five years. The move was said to be a strategy of the digital payment companies to better compete with its major competitors such as SoftBank's OVO and GoPay.
Facebook has been in talks with Indonesian e-payment businesses to boost the latter's competitive position in their respective markets. These Indonesian e-payment businesses were looking to better compete against their strongest online payment competitors in Indonesia.
According to Reuters, three Indonesian digital fintech firms would partner with Facebook Inc., pending regulatory approval from the government. The application would grant the firms the ability to launch mobile payment services in Indonesia. When approved, the plan would be the first of its kind that uses social media Facebook Pay as a unified payment service.
Last November, Facebook and other platforms such as WhatsApp were reported to observe the business strategy. According to Bank Indonesia's assistant governor and head of Payment system policy Filianingsih Hendarta, the three local firms already manifested their interest in seeking tentative approval for a payment partnership with Facebook.
Hendarta claimed that, at present, no one had submitted a formal application. However, he hinted that these firms, including Facebook, merely discussed the possibility through a consultative meeting with Indonesia's central bank. She also revealed that the three companies interested in the business venture are GoPay, OVO, and LinkAja.
The report also claimed that Facebook was looking to bring digital payments into the country and other jurisdictions in Asia, believing that such service would open up extraordinary opportunities for business growth.
Hendarta added that the Indonesian central bank is currently negotiating with the company'' partners in the country. However, since the developments are still under discussion, there is nothing further to share as of the moment.
The report also claimed that Facebook has been looking to expand its services to Southeast Asia in particular. Indonesia has a population of 260 million and is considered as the region's largest economy. Thus, the report suggested that Facebook Inc. seeks to tackle the largest markets globally through its social media platform, including WhatsApp. It was also revealed that the company expects to garner 100 million users if the business plan would push through in the country.
It was also revealed that Facebook is engaging in separate talks with Gojeck that includes the participation of the Alphabet's Google and Chinese e-commerce platform JD.com. According to a source, the discussions may result in a strategic partnership, an investment opportunity, or a collaboration of the companies.
