DBS Bank Indonesia launches SME-focused DBS BusinessClass app in Jakarta
By Masyitha Baziad October 26, 2016
- Connects Indonesian SMEs to 15,000 SEA players and business advisors
- Indonesian SMEs need greater access to the market
TWO years after its initial launch in Singapore, DBS’ social platform for small and medium enterprises (SMEs), BusinessClass, has finally come to Indonesia.
Given that Indonesia is home to 60 million SMEs and 137 million Internet users, PT DBS Bank Indonesia believes that now is the perfect time to convince more Indonesian SME players to go online.
“While the SMEs have played a significant role so far in the Indonesian economy, contributing 60% to the country’s total gross domestic product (GDP), Indonesian SMEs still have limitations in terms of global market access,” said DBS Vickers Indonesia head of research Maynard Arif in Jakarta.
He said that Indonesian SMEs only contribute around 18% of the country’s total exports, compared to 45% for Thailand and 40% for Vietnam.
With the recently launched BusinessClass mobile application, DBS wants to increase the chances of Indonesian SMEs connecting with the 15,000 other SME players across Southeast Asia, as well as with business advisors in the region.
The platform allows users to connect and network, consult with available business advisors, check and attend networking events, get updates on market and industry news, as well as access banking features on the go.
The platform currently has 927 members from Indonesia, with 45 business advisors. Two of the business advisors are from Indonesia, namely Andy Zain, managing director of venture capital firm Kejora, and Billy Boen, founder of youth leadership platform Young on Top.
Other regional advisors that can also be contacted through the platform include, the founding partner of Golden Gate Venture Jeffrey Paine, e27’s co-founder Mohan Belani and 99.co’s founder Darius Cheung.
“You do not need to be a DBS bank customer to be able to use the app. It is free and everyone can use it. If this usage translates into potential customers later on, it would be beneficial, but what we want to do now is to connect SMEs with their regional counterparts so they can access other markets,” DBS Bank Indonesia director of SME Banking Steffano Ridwan explained.
Steffano added that DBS Bank Indonesia will focus on promoting the BusinessClass app in other cities where DBS operates, as well as attracting more business practitioners to be local advisors on the platform.
The next step will be to fully localise all content in the mobile app, and to embed direct-from-app loan application features similar to those available on the platform in Singapore.
“Our app now has some features in English and some in Bahasa Indonesia. Most of the Bahasa Indonesia content is contained in articles and information on specific topics. We are aware of the need to fully localise the app in order to attract more users, including those from rural areas,” he added, saying that the next update of the app will likely be in the first half of next year (1H 2017).
Going digital to open up market access
The idea of empowering SME players is a serious one given the number of jobs the sector creates. SMEs are seen as the next engine of growth in Indonesia.
“We predict that in the next two years, Indonesia’s economy will still grow by less than 6% or around 5.5%. This is due to many factors, including stagnancy in the world economic outlook,” Maynard explained.
“However, if the SME sector is boosted and they have greater access to international markets and can increase their export contribution, this sector will be the one that can possibly hold back any further slowing in the country’s economic growth,” he continued.
Maynard said that the Indonesian government is targeting to increase SME contribution to GDP to 60%-70% in the next three years. However, right now the focus in on empowering and upscaling the existing SME players.
He said that the micro business segment alone employed 40% of the total population of the country.
“This segment is very crucial to employment, and therefore we need to help them scale up. Access to capital is important, we all agree, but there is also one thing that needs to be done continuously, which is education and capacity building With BusinessClass app, we hope that SME players can obtain more information, initiate discussions and start networking to help them go regional or international,” Steffano said.
The SME credit portfolio portion currently stands at around 23% of the total credit portfolio in DBS Bank Indonesia. Without disclosing exact numbers, Steffano said that the BusinessClass app can help DBS to reach more SMEs and give out more loans.
Earlier this year, DBS Bank Indonesia organises a creative SME business model competition in collaboration with The Creative Economy Agency (Bekraf) as an effort to encourage more export-oriented SMEs.
“We are developing various initiatives to support the advancement of SMEs in Indonesia. DBS BIG is one of the initiatives we have introduced. We will also continue to offer our comprehensive SME banking products and services,” said its chief operating officer Rudy Tandjung in a statement.
With the launch of the BusinessClass app combined with other SME-focused initiatives, Steffano said that they hope to increase DBS Bank Indonesia’s SME banking revenue by 20% by the end of the year.