KoinWorks Closes KoinPintar, Education Financing Services Are No Longer Attractive?

Even though it continues to grow, the sector fintech in Indonesia are still trying to find its market. One of them is education financing product (student loans) which not many startups in Indonesia actually work on.

P2P platforms lending, KoinWorks recently reportedly discontinued the KoinPintar service which since 2017 offered loans for tertiary education. First reported by Bisnis.com, KoinWorks did not disclose the reason for this closure.

According to KoinWorks Co-Founder and CEO Benedicto Haryono, this step was taken in order to focus on other financing products. Going forward, KoinWorks strives to achieve carbon neutrality by supporting a sustainable and environmentally friendly business model for MSME players.

KoinWorks' efforts to focus on the MSME segment can actually be seen from its strategy through KoinWorks NEO so that it can expand the reach of financing to MSMEs. Last year, it also introduced assessments new risk profile Grade S to reach more of the MSME ecosystem

Cost of education

Previously in early March 2023, Smart has discontinued education financing products and switched completely to supply chain financing (supply chain leaders). The closure of Pintek and KoinWorks education financing products now leaves only three players, including Danacita, DanaDidik, and Cicil.

Cicil and Danacita are platforms , while DanaDidik offers educational financing facilities through a fundraising model (through crowdfunding) in collaboration with the Student Endowment Fund Foundation.

In exposure Krasia Several years ago, Indonesian President Joko Widodo urged domestic banks in 2018 to provide more education loans in order to improve the quality of human resources.

It should be noted that the enrollment ratio for higher education in Indonesia is still at 31%, lagging behind other Southeast Asian countries, such as Singapore (78%) and Thailand (54%), according to the Global Business Guide Indonesia report. The main factor is due to financial reasons.

Based on data Central Bureau of Statistics (BPS) As of June 2022, the highest total tuition fees were recorded in DI Yogyakarta with Rp. 21,1 million, followed by Banten (Rp. 19,59 million), Maluku (Rp. 19,44 million), North Maluku (Rp. 17,47 million), and DKI Jakarta ( IDR 16,74 million). These education costs include registration fees, pocket money, transportation costs, and operational costs.

Quoting Danacita blog, access to educational financing facilities for tertiary institutions in Indonesia is considered difficult because it is borne by students and institutions. This is different from the elementary (SD) to middle school levels, most of which are suspended by the government.

student loans is a loan product that has high transactions in the United States (US). There, the amount of education loans disbursed is said to be higher than credit card transactions, namely $1,3 trillion. Difference student loans in the US and Indonesia it is quite visible in loan interest and repayment tenor.