Google: Indonesia and the Philippines Have the Highest Number of Unbanked People, Presenting a Huge Opportunity for Digital Bank Growth

Indonesia and the Philippines represent highly potential markets for digital financial services in Southeast Asia (SEA). This is because a significant portion of the population in both countries remains underserved by conventional financial services.

According to research by Google, Temasek, and Bain & Company, 81% of Indonesia's population is unbanked. Therefore, the market for digital banking services in Indonesia remains wide open.

Similarly, in the Philippines, 75% of the population lacks access to conventional financial services. This indicates significant potential for rapid growth in the country's banking digitalization.

Indonesian and Vietnamese consumers show the strongest attraction to digital banks compared to other regional consumers.

Meanwhile, the growth potential for digital banks in Malaysia and Thailand is more moderate, due to a relatively smaller proportion of the unbanked population.

Established conventional banking systems, with their existing financial service ecosystems, including regulatory protections and integrated partnerships, make it challenging for new financial service players to gain a foothold in these two countries.

The growth potential for digital banks in Singapore is the lowest, as only a small percentage of its population is unbanked or underserved by financial services.

The following are the percentages of the 15-35 age group population in six Southeast Asian countries in 2022:

1. Indonesia: 31%
2. Philippines: 34%
3. Vietnam: 30%
4. Thailand: 26%
5. Malaysia: 34%
6. Singapore: 24%