DANA bridges the financial divide in Indonesia

DANA's digital wallet empowers the unbanked and underbanked situations in Indonesia and now has 135 million users.

For archipelagic countries like Indonesia, the process of receiving and sending money can take more time and cost. It does not help that Indonesians are the fourth largest unbanked population in the world, according to the World Bank, with 95 million people underbanked. Such is the condition that opened the opportunity for DANA to offer new payment solutions through the digital wallet.

Since receiving its operational licenses from Bank Indonesia, DANA is cleared for electronic money, electronic wallets, Digital Financial Services, and fund transfers. “We want to be a bridge towards financial inclusion for the Indonesian people through the latest service innovations and features. Our focus on providing payment services and financial services to the underbanked and unbanked communities has yielded good results as shown by the increasing adoption rate of digital payments,” DANA CEO & Co-founder Vincent Iswara told Asian Banking & Finance.

Users can make payments to related merchants, send and receive money, pay bills including electricity, water, mobile phone, internet and tv cable, healthcare, withdraw balances and invest all through DANA. It even has an eMAS feature that allows people to buy gold starting from 0.01 gram or for less than IDR10,000 ($0.67), opening the door to a practical and safe way for buying and selling.

To begin, one only has to download the fintech service application and enter an active cell phone number. Users only need to enter a six-digit PIN every time they want to use the DANA service. At present, there are more than 135 million DANA users throughout Indonesia. Company records also reflect an increase in the average daily transaction of more than 150% on an annual basis.

Amidst the growing volume of its uses and transactions, DANA makes sure not to neglect the security aspects of its customer data.

3 principles plus security

To maintain the best transaction experience for users, Vincent said DANA adheres to three principles governing its system: it has to be trusted, user-friendly, and accessible. “On the first principle, namely being trusted, we continue to strive to build user trust by providing the best security technology,” he said.

On the second principle, he said: “DANA is also committed to becoming a user-friendly digital wallet through its open ecosystem concept, so that DANA can work with partners at various scales. ”The third principle, accessibility, is inherently in place. “DANA strives for users to send and receive money easily, anytime and anywhere,” he said.

Vincent recognises that one of the people’s main concerns is security. According to Verizon’s Data Breach Investigation Report, the financial sector is one of the industries that often experiences data leaks.

For this reason, DANA equips its applications with Risk Engine technology that uses device data to user transaction characteristics to mitigate risks. “Meanwhile, for users, DANA implements a ‘zero data-sharing policy,’ using security technology ranging from PINs to self-developed facial verification technology, namely DANA VIZ (Visual Identity Authorisation) from the very beginning when users download the application,” he said.

They also employ DANA Protection which can guarantee a user’s refund in the event of a balance loss caused by misuse of an account “beyond the user’s control.”

Bright prospects

Boldly, Vincent declared that digital wallets have bright prospects in Indonesia. Offering proof, he cited an increase in the value of Electronic Money transactions in February 2023, which reflected a year-on-year growth of 31.14% so that it reached IDR35.7t ($2.39b), based on data from Bank Indonesia.

To its credit, DANA also experienced positive growth. This digital wallet service grows organically with widespread use not only by users in top-tier cities but extends in various regions in Indonesia. “By 2022, DANA will be present in more than 50% of cities outside Indonesia’s top 20 cities with very rapid penetration in rural areas,” he said.

DANA’s average daily transaction in December 2022 grew by up to 2.5 times or increased by 150% compared to December 2021. “Through program initiatives, technology and collaboration with regulators such as Bank Indonesia, DANA is committed to continuing into providing the best protection, convenience and experience for financial needs and daily lifestyles,” he said.

$1 = IDR14,925

1 IDR = 0.000067