TikTok, one of the world’s fastest-growing social media platforms, has set its sights on helping the SMEs of Indonesia to digitise in the wake of the COVID-19 pandemic. TikTok Indonesia said that the platform wished to capture as many of Indonesia’s 6 million SMEs as possible with its new advertising service for businesses.

As thousands of SMEs flock to online platforms to market their products amid the ‘new normal’, there has never been a more opportune time for platforms such as TikTok to offer their assistance.

“We’re targeting all SMEs with no specific location or business segment,” said TikTok Indonesia direct sales leader Pandhu Wiguna.

TikTok’s owner, Beijing-based ByteDance, plans to take a US$100 million loss this year to provide free advertising credits to SMEs worldwide willing to try the platform’s services.

With this announcement, TikTok has joined a list of tech heavyweights that are of similar intentions. Other online platforms that are set on digitalising Indonesian SMEs include Instagram, Tokopedia, and Lazada. All of the aforementioned companies are taking part in Indonesia’s plan to digitise at least 2 million SMEs by the end of the year.

The plan, kicked off by President Joko “Jokowi” Widodo on May 14, provides for training of SMEs in the use of online business services.

The government optimistic hope is to have overall 10 million SMEs go digital by the end of 2020 to help them recover from the financial burden caused by the coronavirus outbreak, Cooperatives and Small and Medium Enterprises Minister Teten Masduki said earlier this month.

He added that there were currently about 8 million SMEs that had an online presence, either through e-commerce platforms or social media, about 13 percent of the SMEs in the country.

Previously, it was ride-hailing firms such as Gojek and Grab which launched efforts to help digitise Indonesia’s SMEs.

By the government’s estimates, the digitalisation of Indonesia’s SMEs is expected to help reduce 1.5 percent of the economic burden on the nation’s GDP which has resulted from COVID-19 and its subsequent lockdowns.

Currently, the main hurdle that prevents most Indonesian SMEs from utilising digital platforms to market their business is the lack of stable and affordable internet. A Sea Insight study has shown that up to 63 percent of SME owners struggle to access affordable and stable internet connections; while 26 percent of SMEs struggle to access financial services.


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