Abstract :

Microfinance as one of the working capital providers for millions of micro to ultra-micro business owner is now facing the challenged of digital disruption. Microfinance such as cooperatives, BMT (Islamic cooperative Baitul Maal wa Tamwil), CU, Rural bank, Ventures is no longer compete to each other as Fintech is starting to enter the ecosystem. The existence of microfinance remains valid as institutions offer requirement that easily can be fulfilled by the segment such as non-collateral and easy access to payment but, fintech with the aggressive expansion and strategy for growth would find them as non-threatening value proposition. Hence microfinance need to aware of the level of threat and be prepared. Nonetheless, digital transformation in the institution could be one of the options to stay competitive.

In order to optimize the digital transformation of microfinance, this study is prepared to validate the area of digitalization and its relation to answer the need of the customers and stay relevance to the underserved market.

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Keywords :

Digital transformation, Digitalization, Microfinance, Underserved segment.

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