Indonesians going into debt for Blackpink, Coldplay tickets shows dark side of fintech revolution
- Indonesia’s rising prominence in the global music scene is encouraging, but reports of people going into debt to buy concert tickets is reason for concern
- Online lending has made it easier for people to access loans but also exposed them to scams and the excesses that come with flaunting new-found wealth
For music lovers in Indonesia, there is no doubt that this is a great time to enjoy international music, and not just because Blackpink and Coldplay are making stops in the country. Citing records from the Ministry of Finance, a report by MUC Consulting indicates the rise of music concert events in recent months have been so significant that they have helped boost local entertainment tax revenues.
In January and February, concertgoers generated an income of 28.85 trillion rupiah (US$1.9 billion), up from 23.6 trillion rupiah during the same time the previous year.
There is a genuine cause for concern. The country’s outstanding loans through digital platforms totalled 51.5 trillion rupiah in May 2023, up a whopping 28 per cent from just a year ago, according to Bloomberg.
More than half of Indonesia’s 270 million people consists of people between the ages of 18 and 39. A great deal rides on their success and productivity as they are expected to build the nation’s future.
Serving this unbanked population is a priority for the government. At the same time, advising a tech-savvy younger generation that is increasingly exposed to the risks of fintech is emerging as an essential need as well.
Like many Asian economies, Indonesia is now grappling with the rapid changes ushered in by unprecedented e-commerce growth. It is the world’s 11th-largest market for e-commerce with a predicted revenue of more than US$44.8 billion this year, placing it ahead of Brazil.
According to a UN report, the music industry is among the fastest-growing of the 16 creative economy sectors in Indonesia because it embraced digitalisation. During the pandemic, Indonesia became one of the top Southeast Asian streaming hubs for Spotify. More than 50 per cent of the workers in the music industry use e-commerce to scale up their production and expand their market presence.
This is true of other sectors in the country as well. In terms of internet users and retail e-commerce sales, Indonesia topped other regional countries such as Malaysia, the Philippines, Singapore, Thailand and Vietnam in 2021.
Whether it is flaunting new-found wealth or people buying concert tickets they can’t pay for, it is clear the social, psychological and cultural implications of the fintech and digital revolution is something we have not yet fully comprehended. One thing is for sure: it is challenging for governments not just in Indonesia but across the developing world.
Kamala Thiagarajan is a freelance journalist based in Madurai, southern India