Xendit, a mobile application that makes it easy to send and receive money with friends, has launched its service in Indonesia, as reported by TechCrunch.
Xendit is a peer-to-peer payments app which allows the user to send and receive money amongst friends via private groups and chats. It can also be used to repay a friend after a shared meal, or to send money. Users can even use it to request money. Users load money onto Xendit where they can send or request money from friends in the service or through phone numbers.
Xendit works together with Indonesian banks and ATM networks. It holds money on behalf of users before working with the banks to wire it.
“In Indonesia, there’s [greater than 100%] penetration for phones. These people don’t have a bank account and penetration of credit card is at 3%, but there’s a huge population with technology,” explained Founder Moses Lo.
Xendit has 13,000 people using the free service since its beta launch a few months ago. The startup is funded by Y Combinator, the only institutional investor in the company.
When asked on why Xendit is catering to Indonesians, Founder Vivek Ahuja said to e27, “When we interviewed customers throughout the world to develop this product, we were just shocked to hear about the norms of peer-to-peer payment for young, tech-savvy Indonesians. Despite the mobile solutions that you’ve already alluded to, Indonesians still resort to paying each other with cash, IOUs [I owe you], and bank wire transfers.”
“We think we can succeed because we are going to be the only entrant focused on making the peer-to-peer transfer experience as simple as possible – other peer-to-peer payment solutions in Indonesia have typically just been “features” added to other product offerings developed by telcos, banks, or device companies, not products in themselves,” he optimistically added.
Mobile peer-to-peer payment apps, which allow people to send cash to each other instantly, are gaining rapid adoption in the US and globally.
The secret behind the success of these apps is that they solve a real problem for users: they give them a way to pay each other when they don't have cash or a check. For example, if you go out to dinner, these apps make it easy to pay a friend back for covering the cost of your meal.
Globally, the volume of P2P payments is over $1 trillion and only a sliver of those transactions are currently conducted via mobile phones. Xendit is one of the startups in this industry who is also trying to grab the opportunity.