Jakarta, 5 July, 2021 -- PT Visionet Internasional (OVO), Indonesia’s leading e-wallet, has launched its first shariah mutual fund product, which comes with one of the lowest buy-In for a product of its kind (less than US$1) and allows investors to instantly cash out their funds in real time.
“By setting the minimum investment threshold to one of the lowest in the industry at just IDR 10,000,- (SGD$1 or USD$ 0.70) and allowing investors to access their funds at any time to pay for purchases, OVO has removed key barriers to investing,” said Rajiv Chandna, OVO Chief Commercial Officer for Financial Services. “Approximately 40 percent of Indonesians that we surveyed have expressed interest in investing in shariah investments through the OVO application.
The Syariah Syailendra OVO Bareksa Tunai Likuid mutual fund product is offered exclusively on the OVO application as part of the OVO | Invest vertical in collaboration with Syailendra Capital, a top-ten Indonesian asset management fund based on AUM, and OVO’s strategic partner Bareksa.
“We believe that there is enormous untapped potential for shariah products and services,” continued Chandna. “OVO, as a valued and responsible Indonesian startup, is committed to making financial products accessible and affordable for all Indonesians, including shariah products. In addition, loyal OVO users can now earn returns on the money they keep in the OVO wallet.”
Indonesia is home to the world’s largest Muslim-population. Reflecting the strong appetite for shariah-compliant products, shariah mutual funds in Indonesia saw AUM grow by 135 percent over the last three years according to data from the Financial Services Authority (Otoritas Jasa Keuangan).
This is line with the data in The State of Global Islamic Economy (SGIE) Report 2020/2021, which observes that demand for shariah-compliant products and services in Indonesia has risen rapidly, with the country rising from the world’s tenth largest sharia economy in 2018 to fourth position in 2020.
More broadly, there is also significant room for mutual fund growth. At the end of May 2021, less than three percent of Indonesia’s 270-million strong population was invested in the capital market, with some 4.7 million mutual fund investors in Indonesia representing with total AUM of US$ 42 billion, of which more than ten percent was invested in shariah mutual funds.
Previously in January 2021, OVO launched its first digital mutual fund product to strong response, attracting around 450,000 investors in the first three months. More recently, OVO launched its first shariah-compliant financial services product in the form of a shariah-compliant digital life insurance product called PRUTect Care - Hospital Cash in collaboration with Prudential, which had solid uptake supported by OVO’s seamless payment capabilities and low monthly minimum premium payments starting at just IDR 5,000- (US$0.35).
“With this instant cash-out feature and shariah-compliant product, OVO is continuing to drive innovation in the micro-investment landscape in Indonesia, towards enabling more Indonesians to participate in their country’s growth story.”, Chandna highlighted.
Re-disseminated by The Asian Banker