JAKARTA (TheInsiderStories) -Smartag International, Inc. (OTC Markets: SMRN) announce that on Feb. 27, entered into a joint venture agreement with PT Supratama Makmur Sejahtera (PTSMS), an Indonesian financial technology (FinTech) company. Smartag will own 51 per cent equity and PTSMS will own 49 per cent.
This follows an earlier signed on Oct. 12, 2017 between PTSMS and PT Rijan Dinamis Selaras, representing Pondok Pesantren Riyadhul Jannah Pacer Mojokerjo in Central Java, founder of Consultative Assembly of Indonesian Boarding Schools which has a network of 28,000 boarding schools to undertake a FinTech project.
The new company plans to undertake the Indonesian Project to provide a rural e-Wallet FinTech services to approximately 10,000 boarding school students which are owned by many local BMT co-operatives within 3-5 years.
Currently, many of these BMT co-operatives already have their own basic desktop versions of legalized rural micro finance and pawn brokering businesses. Smartag intends to combine these different business platforms into one mobile FinTech platform which will provide students e-Wallet services as well as the current BMT micro financing and pawn broking services.
This platform will also be available to students’ immediate family members. The rural villages will benefit from various subset features ranging from rural e-Commerce supplies of basic food stuff via linked up basic mom & pop stores to micro-financing and pawn brokering.
At the same time, Smartag’s previous three years venture with Shenzhen Shen Nan Shun (SSNST) in e-Commerce fits well with the Indonesian Project. With the recent agreement signed with SSNST/HK Vander to form a Joint Venture company in Hong Kong, Smartag intends to further strengthen its expertise to reach the potentially huge rural South-east Asian communities.
With the principle factors of connectivity via smartphone telecommunications having been mostly resolved, Smartag believes that it has at least a three year lead ahead of the big international e-Commerce competitors, many of them who will stay in the urban areas due to unfamiliarity with e-logistics.
With this Indonesian Project and the corresponding agreement with the BMT co-operative network, which is one of the largest group of identifiable rural communities within South-east Asia (with a total country population of approximately in Indonesia alone of 300 million), Smartag aims to capture approximately 10 per cent or 30 million e-wallet users within 3 to five years.
Chairman of Financial Services Authority Wimboh Santoso stated that Indonesia’s economy today is indeed the 16th largest economic power of the world, and is expected to become the 8th largest by 2030. However, Indonesia is still perched at 112th in the world ranking in terms of GDP per capita, far lower than Malaysia (ranked 68th) and Thailand (84th).
A lack of financial inclusion has been blamed for Indonesians’ relatively low savings rate. Data from the International Monetary Fund show that Indonesia’s gross national saving to the GDP stood at a ratio of 30.87 percent as of 2014, compared to 46.73 percent as reported by neighboring Singapore.
This potential has been targeted by financial services players to expand their business to digital and branchless banking across the nation through sophisticated technology.