Amartha, an Indonesian fintech firm, organized the Asia Grassroots Forum 2025 from May 21 to May 23, 2025.

The forum focused on financial inclusion for grassroots communities and explored the market potential of this segment.

Discussions centered on the role of fintech in fostering innovation and addressing financial gaps in underserved communities.

Amartha CEO Andi Taufan Garuda Putra expressed hopes that the forum would boost investor confidence in the region’s grassroots potential. He said that the event aimed to showcase opportunities within grassroots communities in Indonesia and Southeast Asia.

The event gathered participants including micro, small, and medium enterprises (MSMEs), policymakers, and investors such as Beenext Capital, Accion Digital Transformation, and Maj Invest.

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🔗 Source: Tech in Asia Indonesia

🧠 Food for thought

1️⃣ Indonesia’s vast “unbanked” population creates a massive fintech opportunity despite economic headwinds

Indonesia presents a striking paradox in financial inclusion: the country has the fourth-largest mobile market globally with 339.9 million connections, yet only 36% of Indonesians have access to formal financial services 1.

This gap represents a US $234 billion financing opportunity, particularly among MSMEs which contribute 61% to Indonesia’s GDP but face severe funding constraints 2.

The acceleration of digital adoption during the pandemic, with mobile banking users jumping from 24% in 2019 to 52% in 2021, demonstrates how rapidly this market can evolve when properly addressed 3.

Data shows this market remains largely untapped, with 74% of middle to lower-income individuals and MSMEs still lacking access to financing despite the country’s robust economic foundation 4.

Investors like those attending Amartha’s forum recognize that economic challenges may actually make valuations more reasonable for companies addressing these fundamental gaps with sustainable business models.

2️⃣ Women entrepreneurs represent a strategic focus in Indonesia’s inclusive finance landscape

The emphasis on women entrepreneurs by investors like Women’s World Banking isn’t merely about social impact. It’s backed by financial performance data showing women are exceptionally reliable borrowers.

Amartha’s experience demonstrates this value proposition, having successfully disbursed over $1.6 billion to more than 2.5 million women-led MSMEs with strong repayment rates 5.

Research indicates women entrepreneurs typically display greater financial responsibility, making them excellent credit risks despite being overlooked by traditional banking systems.

This pattern is consistent with global microfinance experience showing women-focused lending programs often achieve higher sustainability through better loan performance and lower default rates.

For impact investors seeking both financial returns and social outcomes, serving women entrepreneurs in Indonesia’s grassroots economy represents a strategic alignment of mission and market opportunity.

3️⃣ Indonesia’s balanced regulatory approach creates competitive advantage in southeast Asian fintech

The investors’ praise for Indonesia’s regulatory environment highlights a crucial competitive advantage in the regional fintech landscape.

The Financial Services Authority (OJK) has implemented a balanced regulatory framework that both protects consumers and encourages innovation, creating what Accion’s Njord Andrewes described as a “healthy ecosystem” 6.

This balanced approach has directly contributed to investor confidence, with fintech investments in Indonesia reaching US$1.4 billion in 2021 despite global economic uncertainties 3.

Indonesia’s regulatory strategy contrasts with more restrictive approaches in some neighboring countries, positioning Indonesia as particularly attractive for fintech development in Southeast Asia.

The establishment of industry groups like the Fintech Lending Players Association (AFPI) further demonstrates the maturation of Indonesia’s fintech ecosystem and its shift toward collaborative self-regulation 4.

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