Dr Ming Gu still remembers the difficulties when FinVolution, a leading Chinese fintech service provider, set up operations in Indonesia in 2018 amid the first wave of Chinese companies flocking to this country of 267 million people.The growth of fintech in Southeast Asia was a key talking point at the 2025 Asian Financial Forum in Hong KongThose were the early days of a fintech revolution in Southeast Asia, particularly Indonesia, which has a vast unbanked population according to World Bank data.“In 2018, when we first arrived, the lack of individual credit histories was a major roadblock,” Gu said during a workshop at the 2025 Asian Financial Forum (AFF) in Hong Kong, held on 13-14 January. “People couldn’t access loans because there was no reliable way to assess their creditworthiness,” he said.This was a classic “chicken-and-egg” problem, where individuals needed loans to build credit, but they couldn’t get loans without credit histories. FinVolution saw an opportunity to change that by creating a new avenue of financial inclusion.Tackling the ‘creditworthiness’ problemAccording to a report by Electronics Payment International, a data service provider, Indonesia’s unbanked population fell to 48% in 2018 from 63.9% in 2014.Although many Indonesians, especially those in rural areas, are steadily being integrated into the formal banking system, the increases in financial service provision still could not keep up with the surging demand. This created opportunities for fintech players like FinVolution.Tracing FinVolution’s journey, Gu recalled its establishment in 2007 as a tech-driven firm focused on bridging the digital gaps between lenders and borrowers.“Fintech is creating new pathways for underserved populations to access credit and financial support, empowering them to invest in their futures,” he said.Historically, banks often overlooked individuals and small businesses lacking credit histories. FinVolution tackled this issue by leveraging non-traditional data and advanced digital credit assessment models.These models, which remain in use till this day, enable first-time borrowers to establish creditworthiness and integrate into mainstream financial systems.FinVolution’s expansion into Indonesia in 2018 provided an opportunity to validate its technologies and business model in a new market.Despite the initial challenges, the company’s solutions steadily improved credit-scoring capabilities, helping to expand financial access to underserved populations in Indonesia, and later also in the Philippines.By Q3 2023, the company had supported over 6 million borrowers and facilitated more than $3 billion in loans outside China. These efforts have focused on empowering underbanked young workers and small business owners across markets like Indonesia and the Philippines.At the AFF, Gu told of an NGO leader from the region who faced a cash crunch while running canteens for elderly residents. When traditional financial i
Lun. Gen 20th, 2025
