Published on
September 21, 2021

FinTech vs Banks in Indonesia: Which One is Better for International Payments?

min read

In this article, we’ll take a closer look at the differences between fintech and traditional banks in Indonesia, not only from cost-effectiveness - but also looking at other factors that are important for businesses.

Let’s dive in.

Exchange Rate

It’s no secret that bank fees when making cross-border transactions can add up and prove to be quite costly to businesses, especially businesses that make these transactions frequently. The cost of cross-border transactions can be split into two different areas: FX rate costs and transaction fees.

Traditional Banks

Banks use their own FX rates that are usually higher than the real mid-market rates, meaning your business will lose money per dollar transferred through the banks. By having different buy and sell rates, banks are able to make marginal gains when facilitating international transactions. After all, banks are businesses that need to generate profit – this is just one of the ways to do so.

Wallex in Indonesia

With Wallex Indonesia, businesses have access to mid-market FX rates. Cross-border transactions shouldn’t result in your business losing excessive amounts of money, every single dollar that you’ve earned is rightfully yours and Wallex Indonesia’s FX rates are transparent & accurate to help your business maximise every single cent.

Transaction Fees

Traditional Banks

The next cost that is incurred when making cross-border transactions is transaction fees. Banks in Indonesia usually charge USD 25 for intermediary bank charges with an additional service charge of IDR 50,000 when transferring money from a business bank account. Banks in Indonesia charge a percentage (%) of the total amount being transferred. Over time and multiple transactions, the cost of transferring money across borders with a bank will add up and leave a hefty dent in your wallet. Banks in Indonesia also tend to charge administration fees for business bank accounts on a monthly basis.

Wallex in Indonesia

On the other hand, Wallex Indonesia charges a flat fee of IDR 80,000 per transaction. There aren’t any percentage-based fees charged - transfers involving large sums of money won’t cost too much money. Coupled with the fact that we don’t have a maximum transfer amount, this ultimately increases your potential savings proportionally to the amount of money being transferred. Additionally, Wallex Indonesia does not have a monthly administration fee – that’s one less maintenance expense to worry about when choosing Wallex Indonesia.


Traditional Banks

To understand the transfer speeds that banks offer, it’s important to understand how banks transfer money across borders. Banks across the world use SWIFT to transfer money from country to country, and Indonesian banks are no exception. SWIFT is a payment network that allows businesses as well as individuals to receive or make payments even if the other party in the transaction uses a different bank¹. Each member institution of the network is given a unique ID code which helps banks communicate with each other to facilitate transactions.

It’s important to note that SWIFT does not actually send money, it’s just a method of communication. This ultimately can result in time delays as banks scramble to communicate with another. Banks play the role of intermediaries, so transfers can take as long as 3-5 days. This is the preferred option for transferring large amounts of money. Wallex supports transfers via the SWIFT network².

Wallex in Indonesia

With Wallex Indonesia, making transfers out of Indonesia is quick and worry-free. Our platform connects businesses to a network of payment partners around the world, eliminating the need for middlemen. The result is simple: enjoy quicker processing times and avoid spending on unnecessary fees. A transfer from Indonesia to Singapore can take as little as a day to complete with our platform, which means more time for your business to focus on the things that matter.


Traditional Banks

Banks can be a bureaucratic nightmare in Indonesia, especially for large scale businesses that make frequent overseas transfers. When making transactions online, businesses are only allowed to transfer up to a maximum of USD 25,000 online – anything above this would require a visit to the bank to fill in more complicated paperwork. Not only can this be inconvenient for businesses, but it also wastes extraordinary amounts of time that can be used more productively instead of lining up at the bank.

Wallex in Indonesia

Making cross-border transfers with Wallex Indonesia is simple and convenient. Gone are the days of queuing up for hours at the bank - having a fully online platform allows you to make transfers wherever you are, at any time. There is also no cap on the amount of money being transferred which helps businesses avoid mountains of documentation and paperwork. Transfers should be a simple, linear process with as little trouble as possible, and we’ve made it a point to make our platform convenient and user-friendly.

Supporting features made for business

No Minimum Balance Requirement

Banks in Indonesia usually have a minimum balance requirement which can be troublesome especially if you don’t want to keep too much money in a single business account. With Wallex Indonesia, there is no minimum balance requirement to open a business account – no matter the size of your transactions, we’re here to make cross-border business easy for you.

Supports Foreign Currencies

While local banks only support around 13-16 currencies, Wallex Indonesia offers 47 currencies to make payments in. Even though your business is located in Indonesia, our platform will bring the world to you.

Rates locked for 24 hours

FX rates fluctuate constantly and may even worsen over as little time as a day. One of Wallex Indonesia’s business account features is currency hedging. Lock in the best mid-market rates for up to 24 hours with your Wallex Indonesia business account and avoid losing money to fluctuations.

Dedicated Account Manager

With most local banks, little expertise and support is offered to help you in managing your finances and transaction-related matters. Enjoy dedicated support for your business from our FinTech experts when you sign up for a Wallex Indonesia Business Account.

Bulk Payments

Making payments in bulk with local banks is either extremely difficult or not possible at all. With our platform, make multiple payments in one go and avoid the trouble of having to split single transactions into multiple processes.

Case Study: How Almaflor Simplified Its International Payments From Indonesia

Almaflor is a vinyl importer based in Surabaya, Indonesia and has 13 official distributors across the country. Most of Almaflor’s products are manufactured in China – as a result of this, the business makes cross-border payments in large amounts 2-4 times a month.

Almaflor previously used BCA (Indonesia’s leading bank) to make USD-CNY transfers to its suppliers in China. After assessing its payment solutions and needs, Almaflor made the decision to switch to Wallex Indonesia. Time and cost efficiency were the main drivers behind their decision to make the switch – both areas fall under Wallex Indonesia’s wide umbrella of FinTech expertise.

How did Wallex Indonesia streamline and improve Almaflor’s transaction process?

#1 – Increased Cost Efficiency

One of the biggest problems that they faced with major banks in Indonesia such as BCA is that their transaction amounts were capped at USD 25,000. For a business that makes regular high-value payments, this would prove to be inconvenient due to the complicated paperwork that banks require for large transactions. Almaflor executives had to split their invoice payments which resulted in higher costs for transaction fees.

With Wallex Indonesia, Almaflor was able to make high-value transactions without worrying about expensive platform fees or splitting payments into multiple transactions. Flat transaction fees and the best mid-market FX rates also helped Almaflor save more when transferring money overseas.

#2 – Quicker Transfer Speed

Major banks in Indonesia have a complicated documentation process for large transactions. Naturally, there would be setbacks in processing times, and this would result in further delays in funds being received by Almaflor’s suppliers. In some instances, entire transactions would be rejected - restarting the entire process again is time consuming and troubling.

Our platform allows for transactions to be cleared much quicker with far less complicated paperwork. This simplicity allows for large payments to be hassle-free and much more convenient.

#3 – Support and Expertise

Without a dedicated finance team, Almaflor’s owners had to manage the payments by themselves when working with local banks. Larger transactions were also difficult when managing reconciliations for both Almaflor and its suppliers.

With a platform that’s simple to use and with a dedicated account manager, reconciliation and documentation became easy with Wallex Indonesia!

Make the Switch: Save Time, Money, and Effort with Wallex Indonesia

Wallex Simplifies Cross-border Payments

Globalise your business and simplify your payments with Wallex. Get in touch with our FX expert and learn how we can help you save time and money while you scale  your business.

² Wallex enables customers to perform SWIFT transfers via our network of banking partners.

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