Payments landscape in Indonesia to get an overview of players, value chain economics, market drivers and the competitive landsacape. Indicator/introduction of payments ecosystem in Southeast Asia/ASEAN.

1. Payments Landscape, Indonesia
May 2014

2. 2
Agenda
• SEA Payments Overview
• Indonesia Mobile Payments
– Mobile Payment Value Chain Economics
– Mobile Payment Aggregators in Indonesia
• Summary

3. 3
Credit Card (& Banking in ID) Penetration in SEA is
lower than Internet penetration
Source: World Bank 2011

4. 4
Mobile Payment Transaction Volume in APAC is
expected to double by 2017
Source: eMarketer, includes all bill payments, merchandise purchase, money transfers and FC transactions
$B

5. 5
Mobile Internet Users use mobile payments in SEA for
different mobile commerce & banking applications
Source: eMarketer, Dec 2013, n=500 in each country ages 18-64 who access internet at least once/week and have a bank account

6. 6
Payments in Indonesia are mainly still cash driven…
Source: Mastercard

7. 7
In Indonesia, mobile payments usage is below
average – requires more consumer familiarity &
willingness
Source: Mastercard, Siftscience
INDONESIA (#3)
MALAYSIA (#1)
THAILAND (#4)
PHILIPPINES (#2)
(#): E-commerce Fraud ranking

8. 8
Mobile Payment Users and Penetration in Indonesia
is expected to more than double by 2017
Source: eMarketer
(Millions)

9. 9
Indonesia Mobile Payments Landscape
• Mobile Payment providers in Indonesia are of mainly 3 types
– Aggregators of mobile, online and physical payment channels for online and mobile games
– Operator dependent pure mobile payment providers for digital content and services
– Operator mobile wallets
• All compete for similar merchants but differ on the number of funding/top-
up options – retailers, mobile phone, cyber-cafes, bank ATMs, online web
• Regulations prevent airtime to be used directly to buy digital content and
services
• Value chain economics differ dependent on top-up channel, where retail
stores and operators are the most popular followed by Cyber-cafes and bank
ATMs.

10. 10
Prepaid SIM Value Chain Economics in Indonesia
Source: Interviews
7% 93%
Retailer
Up to 3 Distributors
Operator + Payment + Service Providers
75% 25%
3% 97%
75%
PREPAIDSIM
CONSUMER
Bank/ATM Operator + Payment + Service Providers

11. 11
Mobile Payment Value Chain Economics
Source: Interviews; 1Includes bank aggregator; 2Cybercafe takes less share than retailers as their primary source of revenue is renting games by the hour;3 Could be
higher than 25%
20% 80%
Game Credits
Provider
Publisher + Game Developer
75%
Bank/ATM1
e.g. Payment provider
25%
Retailer2
3% 12% 10%
Operator3
75-97%

12. 12
Mobile Payment Aggregator in Indonesia
Gaming/
Digital Content
Focused
E-commerce
Focused
E-Money/
E-Wallet
Payment
GatewayINAPAY
Source: Analysis
Pure mobile,
operator billing
dependent
Mobile/Online/Cash
Payment
Aggregators
Operator
Wallet

13. INDOMOG
Indonesia Multi-online Payment Gateway
13
Established Users Merchants
Distribution
Channels
Revenue Staff
20081 350,000 90,000 30,000
Zynga:
$500K/mont
h (30% of
total)
72
1Techinasia;2E27
Products
Game vouchers in denominations of IDR 20K, 50K, 100K
Partners2
Gaming 140 games from Zynga, Lyto, Megaxus, Wave Game, Kreon, Asiasoft, and Qeon
Content FB credits, music from KlikMusik, MelOn, MusikLegal, and digital magazines and
comic books from WayangForce and Ngomik
Services Utilities (Water, electricity), landline, Internet, TV, mobile phone credits
Distribution Alfa Retail Group, (7K), 7-11, ATMs, Supermarkets, Family Mart, Circle K, Hypermart

14. 14
Established
Users/
Transactions
Merchants
(WW)
Distribution
Channels
Gross
Revenue
Staff
2000
60M
transactions
40K in ID
600K globally,
88 online banks
$300M
globally
Source: Interviews
Product –
MOLPoints: credits for games/digital content
MOLReload – airtime top up
MOLPay – online payments (merchant acquirer)
Partners
Payment
Channels
Over 35 channels across cybercafes, online bank, outlets, mobile
Partnering with Incomm (prepaid card provider for top brands in the US)
for prepaid cards for non gaming content/services
MOLPoints Revenue Share 5-15% to:
Retailer: Large
Cybercafe: Smaller
Bank + Aggregator: Smallest
Value
Proposition

15. Unipin
15
Established Users Merchants
Distribution
Channels
Gross
Revenue
Staff
2010
0.3M MAUs,
500K
transactions
/month
2K games,
40
publishers
9000 outlets
(Indomaret
Exclusive)
30
Source: Unipin; Poker4choice; Yahoo
FEATURED GAMES
Products
UniPin Credits – similar to MOL Points
UniPin Reward Points

16. 16
Established Users Merchants
Distribution
Channels
Gross
Revenue
Staff
2011
150M
(outreach)
30 4 Operators X 15
Source: CodaPay
Products: PulsaQ for Axis
Value proposition: Reduced mobile payment steps to 4 compared to competitors
Partners2
Merchants

17. IPAY88
17
Established Users Merchants
Distribution
Channels
Gross
Revenue
Staff
2006 X
5000
globally
X X 180
Source: Ipay88
Products
Partners2
E-Payment
• Regional Payment gateway provider.
• Exclusive partner of Paypal for MY, ID,
PH, TH
Indonesia Pricing

18. 18
Established Users Merchants
Distribution
Channels
Gross
Revenue
Staff
2000 3.3B reach
500+ in 80
countries
400
Operators
X >100
Source: Mopay
Products
Partners
Top game developer
for China Mobile

19. DOKU
19
Established Users Merchants
Distribution
Channels
Gross
Revenue
Staff
20071 X 800 X
$1.1B in
6 yrs
11-50
Source: Doku
Products for different type of sellers
Partners2
Garuda Indonesia, AirAsia, Guvera, Unicef, WWF, Java Jazz Production, RajaKarcis, Mulia
Hotel, and Bank of South Pacific
Enterprise Social Media Personal Spenders
Merchants
E-Payment

20. 20
Established Users Merchants
Distribution
Channels
Gross
Revenue
Staff
2011 X 6000 X X 11-50
Source: Ipaymu
Products
Partners2
Channels 137 banks
E-commerce solutions – credit/debit cards, e-wallet, money transfer, escrow (charges 1%), cross-
border/multi-currency transaction support, Cash On Delivery
Payment Gateway
Merchant Service Provider

21. Online Payment Gateway Provider
21
Established Users Merchants
Distribution
Channels
Gross
Revenue
Staff
2012 X 140 X X 60
Source: Veritrans
Products – payments with free fraud detection
Partners2
Merchants
E-Payment One stop for Credit card , ClickPay Mandiri , CIMB Clicks , BRI e-
Pay , Cash XL , Telkomsel T-Cash

22. Payment Aggregator Comparison
22
Established Users Merchants
Distribution
Channels
Gross Revenue Staff
2000 3.3B reach
500+ in 80
countries
400 Operators X >100
2000 60M transactions
40K in ID
600K globally, 88
online banks
$300M globally
2006 X 5000 globally X X 180
2006 38 54
2007 X 800 X
$1.1B in
6 yrs
11-50
2008 350,000 90,000 30,000
Zynga:
$500K/month (30%
of total)
72
2009
22
(e-commerce)
2010
0.3M MAUs, 500K
transactions/month
2K games, 40
publishers
9000 outlets
(Indomaret
Exclusive)
30
2011 150M (outreach) 30 4 Operators X 15
2011
33K
(29K transactions)
$5M 11-50
2011 X 6000 X X 11-50
2012 X 140 X X 60
INAPAY

23. SUMMARY
• Low PC Internet penetration, bank penetration & credit card penetration and high
mobile phone penetration makes mobile payments a huge opportunity in Indonesia
• Three types of players currently – Telco-led wallets, payment aggregators offering
several channels for topping up (multiple source of funds) and pure mobile
payment providers closely working with Telco
• All players compete for digital content (mainly online and mobile games)
merchants, differentiation based on the number of funding channels offered
• Regulations and nascent stage of the market keep the global players like Paypal
away
• Regulations are typically around preventing consumer and agent fraud
• These regulations can be unclear and comprehended differently by operators.
• Other than banks no one else has the power to validate consumer identity
• There could eventually be an opportunity for 3rd party consumer and agent
validation services
• Thailand and Vietnam are the only 2 SEA countries where regulations allow airtime
to be used to buy digital content directly

24. Appendix

25. 25
Established Users Merchants
Distribution
Channels
Gross
Revenue
Staff
2011 15M 500 Telkomsel X X
Source: Telkomsel
Products
Partners
Merchants