Indonesia's MSME digitization target can be reached earlier: CELIOS

Indonesia's MSME digitization target can be reached earlier: CELIOS

Director of the Center of Economic and Law Studies (CELIOS), Bhima Yudhistira, at the ‘B2B FMCG Indonesia Outlook 2023’ press conference in Jakarta on Thursday (January 19, 2023). (ANTARA/Suci Nurhaliza)

This target can possibly be achieved at the end of 2023.
Jakarta (ANTARA) - The Center of Economic and Law Studies (CELIOS) has expressed optimism that the government’s target of digitizing 30 million micro, small, and medium enterprises (MSMEs) by 2024 will be achieved sooner.

“This target can possibly be achieved at the end of 2023,” director of CELIOS, Bhima Yudhistira, said at a press conference here on Thursday.

In December 2022, Cooperatives and SMEs Minister Teten Masduki said that at the beginning of the pandemic, there were only 8 million MSMEs that were connected to the digital ecosystem. However, by the end of 2022, their number had jumped to 20.76 million.

According to Yudhistira, it cannot be denied that the pandemic has accelerated digitalization in Indonesia, including among MSME players.

He noted that the change in consumer behavior has also been one of the factors that has encouraged MSMEs to enter the digital ecosystem. This is because, currently, consumers prefer to find and buy goods online instead of directly visiting offline stores.

“People order goods through online platforms or WhatsApp, even though the distance (to the store) is only 100 meters. It is not wrong. Thus, like it or not, business owners must be digitally literate,” he remarked.

He informed that based on the “B2B FMCG Marketplace Indonesia Outlook 2023 Research” conducted by CELIOS, more than 60 percent of MSMEs have implemented digitalization in looking for suppliers and carrying out customer outreach.

The research was supported by the B2B ecosystem service provider GudangAda.

Another factor that has boosted digitalization among MSMEs is the shift in the payment system from cash to cashless, for example, by using virtual bank accounts and the Quick Response Code Indonesian Standard (QRIS), he added.

There is pressure from consumers to provide cashless methods for payment, he noted.

“Thus, the pressure has made MSMEs, like it or not, adapt quicker,” the CELIOS director remarked. 

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