State-owned Pos Indonesia is diversifying into financial services and has picked an Islamic fintech route to do so.
Known as PosGO Syariah, the app is backed by the government and has the greenlight from the national Shariah board to operate as a digital mobile Islamic ecosystem. It will allow the world’s largest Muslim population to manage their wealth, trade, save and transact in interest-free gold bullion.
Among the features in the app include: PosGold, a digitalized physical gold trading platform; Switch, a real-time peer-to-peer transfer service for gold and fiat currency; Pos Pay, a payment gateway and e-wallet service; and Gold to Mecca, a gold-based community savings program for Hajj and Umrah.
The app is a public-private partnership between the national postal service, Europe’s Kinesis which is providing the technology and gold-back monetary system, ABX, Indonesia Commodity & Derivatives Exchange and Bullion Ecosystem International.
The entry of Pos Indonesia into the financial services sector reflects an emerging global trend where postal services are increasingly used as vehicles of financial inclusion and financial democratization. With their extensive established network nationwide, including in rural areas, digital finance service providers are leveraging postal services’ wide distribution network to service the market including the unbanked.
In the case of Pos Indonesia, it is well-positioned to serve the Republic’s 270 million population through its 24,000 physical service locations across the country.
“PosGo Syariah is a large ecosystem that integrates many parties to be able to actively conduct trade, business, service, utility, financial transactions as well as an ecosystem that integrates the supervisory work processes of all regulatory agencies in Indonesia with the aim of improving the quality of protection for the community as consumers and forming a systematic solution ecosystem for a better community life,” Pos Indonesia noted.
The soft launch of this app, which is currently being used first by the postal service’s 45,000 employees, comes at a time when Indonesia is aggressively pushing its Islamic economy agenda. Pos Indonesia expects the app to be rolled out across the nation in the coming months.