Four Years Of OVO Transformation Comes To Be A One Stop Solution For Digital Financial Services

Illustrations (Photo: Dok. OVO)

JAKARTA - The author remembers well when at the end of 2017 he was offered a reward card by a department store cashier when he was about to complete a purchase transaction. In his explanation, the cashier said that this card provides a point collection facility that can be exchanged as a discount when making the next purchase.

In the writer's mind, maybe what he meant was an electronic money scheme that was indeed being intensively present at that time along with the mandatory non-cash transactions on toll roads.

"Yes, ma'am," said the author giving approval to make the card in question.

Long story short, since then the development of electronic money seems unstoppable. Today, it is common to find financial transactions without cash. It is enough to scan the barcode provided, then the transaction has been legally completed in seconds.

One of the important players in the development of electronic money in Indonesia is OVO. Founded by Lippo Group on September 25, 2017, this brand has become a pioneer in the digital finance industry in the country.

During its four-year journey, OVO has not only focused on completing buying and selling transactions. Moreover, this trademark under the auspices of PT Visionet Internasional is a link for a variety of comprehensive and multi-disciplinary financial services, both online and offline transactions.

In fact, OVO has pushed itself to always be relevant to consumer needs through the various facilities provided. It is noted that this 4.0 financial services company has transformed to connect various digital transactions, such as transportation, food ordering, online shopping, to investment, insurance, and loans.

OVO's Head of Corporate Communications Harumi Supit said that his party is committed to continuously responding to user needs.

He mentioned that the services available are now wider, especially in serving the majority of the people who are still in the category of underbanked (not yet using financial services optimally) and unbanked (not yet touched by financial services).

"This illustrates that digital payment applications can provide a strong and complete foundation for the community, so that it becomes a one stop solution that is easy, fast, safe and convenient to use, no need to switch applications to get various financial services," said Dua in a press statement. , quoted Thursday, October 28. In detail, Harumi explained several products that are now a mainstay, including money market mutual funds, both conventional and sharia-based, called OVO Invest. Harumi claims that since the investment service was introduced in the first semester of 2021, the number of potential investors has reached 450,000 people.

As for insurance services, OVO launched a digital-based sharia life insurance product in collaboration with Prudential Indonesia.

Then this digital platform also penetrated the micro, small and medium enterprise (MSME) sector by releasing the Business Capital OVO service as a form of support to 70 percent of populist business actors who cannot access capital loans for expansion.

"Through these various financial facilities, OVO seeks to address the gap in the financial ecosystem in Indonesia so as to reduce the number of underbanked and unbanked people," he said.

Recently, OVO together with Grab Indonesia launched the Government's Online Transaction Acceleration Program (Patriot) which aims to support the Regional Digitization Acceleration and Expansion Team (TP2DD).

The two mutually affiliated business entities cooperate with the Surakarta City Government as a strategic partner of the Patriot Program.

President of Grab Indonesia, Ridzki Kramadibrata, said that his party is committed to encouraging the acceleration and expansion of regional digitalization through three main steps.

First, digitizing the market to make it easier for traders to run their business. Second, Electronification of Regional Government Transactions (ETP) to increase Regional Original Income (PAD). And the third is to support Non-Tax State Revenue (PNBP).

"The collaboration that is built is expected to increase the number of MSMEs entering digital platforms, especially traditional market traders as an effort to support the government's target of reaching 30 million MSMEs by 2024," he said in a virtual channel, Thursday, October 21.

On the same occasion, Surakarta Mayor Gibran Rakabuming Raka welcomed the cashless payment initiative because it makes transactions easier and more accountable.

“We have prepared 44 traditional markets for onboarding, including Legi Market and Purwasari Market. We will educate sellers and buyers to get used to the current situation,” said Gibran.

The bureaucrat who is familiarly called "Mas Wali" assessed that the pandemic situation had made people inevitably become more digitally literate.

"Let's give support to MSMEs in Indonesia," said the eldest of President Joko Widodo.

The role of OVO in encouraging MSME actors to participate in adopting payment methods using application-based electronic money is increasingly real.

SMEs feel helped

Citing a study conducted by CORE Indonesia on 2,001 OVO partner MSMEs in eight provinces, it was stated that most MSME players have found it helpful since joining this digital payment platform.

"Most of the survey respondents reported an increase in daily transactions and monthly income, and now use banking services more often than before joining OVO," said CORE Indonesia's report released on Friday, October 1.

In detail, as many as 73 percent of MSMEs currently use electronic money more often for transactions.

Then, about 70 percent of MSMEs experienced an increase in daily transactions with an average increase of up to 30 percent. Meanwhile, the average monthly income rose 27 percent for 68 percent of respondents who experienced an increase in income after joining OVO.

To note, OVO itself is now controlled by Grab, which holds 90 percent of the company's shares after acquiring from Tokopedia and Lippo Group owned by conglomerate Mochtar Riady.

Grab Holdings Inc. officially acquired share ownership from PT Tokopedia and Lippo Group in PT Bumi Cakrawala Perkasa, OVO's parent company. Previously, Tokopedia owned 36.1 percent shares, Lippo Group owned 7.2 percent shares, and Grab had 39.2 percent shares.

Other shareholders in PT Bumi Cakrawala Perkasa, are Tokyo Century Corporation which owns 7.5 percent and Wahana Innovation Lestari with 5 percent.

Through a number of breakthroughs and business transformations, OVO has now transformed into one of the business entities that is considered and in demand by big investors.

Thanks to the ability to harness the potential of technology, OVO is now valued at US$2.9 billion, according to Wikipedia, in just four years of its founding.

Startled? Definitely. This is also the case with the author, who just a few months ago realized that the shopping transaction card given by the Matahari Department Store cashier in 2017 was actually emblazoned with the OVO trademark.