The COVID-19 pandemic has had a tremendous impact on business continuity, especially for the Micro, Small, and Medium Enterprises (MSMEs). Katadata reports that the majority of MSMEs have been affected by the Covid-19 pandemic, which is up to 82.9% of MSMEs in Indonesia.

They experienced a severe impact, such as a decrease in turnover and had to reduce employees. To maintain their business in the midst of the pandemic, various ways were taken. Digitizing MSMEs is the key.

This is in line with the Katadata report which states that 29.1% of MSMEs have penetrated digital marketing channels during the pandemic. In fact, 8 out of 10 MSME businesses say that the use of digital platforms has helped them run their businesses during difficult times.


What is MSMEs Digitization?

Seorang pebisnis UMKM melakukan digitalisasi UMKM di bisnisnya

MSMEs digitization is changing the MSMEs business model from conventional to digital to increase the effectiveness and efficiency of its business processes and operations. Originally, MSMEs are conducting business fully offline and might dominated by cash for its transactions. 

Digitizing them means to explore digital platforms to expand its marketing channels, to implementing digital innovations to improve its management and service operations. Thus, shifting the business management towards a more modern practices and gaining competitive edge.

Along the way, BRI has been actively contributing in pushing the MSMEs digitization process, from financing options, non-financing efforts such as through trainings to improve digital and business literacies, as well as providing digital initiatives that can leverage MSMEs, such as easily-integrated banking services through API. 

This is in line with Bank Indonesia's vision in the Indonesia Payment System Blueprint 2025: bringing 62.9 million MSMEs into the formal economy in a sustainable manner through the use of digitalization.

In fact, digitizing MSMEs is not only using technology to sell products. Beyond that, it allows MSMEs to manage finances, organize business cash flows, and acquire raw materials online. Thus digitalization plays an important role in the overall MSME business process.

Digitalization has even made the growth of MSMEs grow rapidly during the pandemic. Indonesian Minister of Communication and Information Johnny G. Plate emphasized that the number of MSMEs that were digitized during the pandemic reached 16.4 million MSMEs, growing two times prior to the pandemic.


Benefits of Digitizing MSMEs

A couple get the benefits of digitizing MSMEs

There are various benefits that can be obtained from digitizing MSMEs. These benefits are as follows:

1. Expanding business opportunities

Grown locally, MSMEs usually had a limited marketing scope. Their consumers are only those who live nearby. They relied more on conventional ways to promote their products, such as word-of-mouth marketing.

So, by digitizing MSMEs, it can expand the consumer network. Communities on various digital platforms will eventually know about these MSMEs and their products, gaining more attention from a wider audience.

2. Responding to lifestyle changes 

Minister of Cooperatives and SMEs Teten Masduki said that the upcoming trend is online shopping. He also emphasized that Indonesia has the largest digital market potential in Southeast Asia. One of the supporting infrastructures is MSMEs.

Therefore, by digitizing MSMEs, they will be able to adapt to the online shopping trend. If MSMEs fail to adapt, they will face harder competition from those who digitize their business.

3. Easier transactions for consumers

Online shopping trends actually change the way customers make transactions. Now, they are starting to switch to digital transactions.

Various MSMEs have also been supported by digital payment through  BRIAPI, an open banking service from BRI. BRIAPI provides numerous products for transactional and informational needs. Thus, merchants can get a complete digital payment system that business needs.

4. Increasing business revenue 

This is an end goal for any business: increasing revenue. Through digitization, MSMEs provide easier access to digital payments for consumers while optimizing their financial systems. As a result, business processes become more efficient and bring more profits.

Examples of MSMEs Digitization

To better understand how conventional businesses digitize MSMEs, here are some examples:

Pasar Santa, Shifting Traditional to Digital

A merchant selling its products at Santa Market

Pasar Santa (English: Santa Market) is a traditional market located in Kebayoran Baru, South Jakarta. From mid-2014 to 2015, Santa Market was a culinary and community center. However, a major increase in rental fees in 2015 made sellers and communities choose to leave Pasar Santa. 

Along with technological developments, several food stalls survive by relying on digital services. Digital payments via e-wallet and online delivery via ride-hailing services establish a new backbone for its merchants. In fact, in the midst of the Covid-19 pandemic, Pasar Santa has become a role model for MSMEs digitization. 

Today, Pasar Santa's merchants apply cashless methods as their payment system. They continue to digitize every possible aspect to support their business. Now, we can safely say that in the end, Pasar Santa has successfully revitalized itself digitally.


Majoo Indonesia, A Start-up That Helps MSMEs

Logo Majoo Indonesia

Majoo Indonesia is an entrepreneurial application startup for MSMEs. Majoo has various features, ranging from cashier applications, payment systems, inventory applications, to e-commerce features, which are integrated with marketplaces.

Since its founding in 2019, the company has processed more than 80 million transactions from various MSMEs worth US$ 600 million. They help MSMEs in 600 cities and continue to develop the latest features to strengthen MSMEs' digitization.

Together with Xendit and AC Ventures, BRI through BRI Ventures supported the development of Majoo by injecting Pre-Series A funding of IDR 56.57 billion to the company. Moving forward, Majoo will further develop a platform that uniquely serves Indonesian MSME businesses.


Pasar Santa and Majoo are two examples of how MSMEs digitization is really happening. It plays a major role in providing the widest and best possible service to consumers.

As the largest MSME bank, BRI has been supporting Indonesian MSMEs to Go Digital through many efforts, from financing to beyond financing initiatives such as BRIAPI. By integrating BRIAPI, MSMEs who opens their store on e-commerce or those who built their own online store can enrich their digital payment options, as well as digitized financial management.

BRIAPI aims to assist MSMEs with their financial management, as well as to improve their customer experience in making transactions. MSMEs can integrates BRI products easily at one time through BRIAPI, such as BRIVA, Fund Transfer, to Account Information that can help to automatically record transactions.

BRIAPI also ensures the safety of each transactions and customer data security in exchange. BRIAPI has met the National Standard of Payment Open API (SNAP BI), a set of standard launched by Bank Indonesia. It has also been certified with ISO 27001 which ensures the safety of customers' data exchange and transfers among BRI and its partners.

To conclude, MSMEs need to adopt BRIAPI products to increase their competitive advantages. BRIAPI guarantees MSMEs to be one step closer to consumers, and one step ahead of competitors. Start now and maximize your business by digitizing MSMEs.