TIKTOK SHOP LOOKING TO REIGN OVER E-COMMERCE PLATFORMS IN SOUTHEAST ASIA 31 of 2023, Tiktok must separate social media from e-commerce,” he added. But with Minister of Trade Regulation No. “There are two permits: social media and e-commerce. What’s next for TikTok Shop in Indonesia?Īccording to a local media report quoting the country’s Director General of Public Information and Communications of the Ministry of Communications and Informatics, Usman Kansong, Tiktok Indonesia has two permits from his ministry. Momentum Works said the country represented 42% of TikTok’s US$4.4 billion regional gross merchandise value (GMV) last year. “Out of the five million local businesses on TikTok, two million sell on TikTok,” Anggini Setiawan, TikTok Indonesia’s head of communications, told AFP last month. The unprecedented regulation for the popular video-viewing app will bring TikTok’s e-commerce thrust to a screeching halt, just as it was gaining traction against Sea Ltd. ![]() What the authorities in Indonesia want is for TikTok and other platforms to split shopping from social media. Ī license would allow TikTok to earn from transaction fees and compete more effectively with other payment service entities. ![]() TikTok accepts various payment methods for payments, including debit/credit cards, digital wallets, bank transfers, and cash,” the company explained in a fact sheet. “TikTok currently does not have its own payment and logistics system in Indonesia. WHAT IS THE PRICE OF DOING BUSINESS FOR TIKTOK?ĭespite its expanding operations, TikTok did not receive an Indonesian payment license and relies on third-party payment service providers within the country. “As such, we will no longer facilitate e-commerce transactions in TikTok Shop Indonesia by 17:00 GMT+7, October 4, and will continue to cooperate with the relevant authorities on the path forward,” the company said in a Tuesday statement. “Our priority is to remain compliant with local laws and regulations,“ said TikTok. The move will impact roughly two million small businesses on TikTok Shop. ![]() Unfortunately, TikTok has been forced to end its e-commerce feature in the Southeast Asian nation this week or risk losing its local operating license. TikTok launched the shopping feature in Indonesia in 2021, and its instant success has encouraged it to expand into online retailing in other markets, including the US. The country, one of the largest markets for TikTok, is officially the first in Southeast Asia to push back against the ByteDance-owned app, even though the social media app’s fastest-growing feature, TikTok Shop, has a burgeoning fan base in Indonesia. Indonesia, home to an estimated 125 million TikTok users, said farewell to TikTok Shop on October 4th due to a new regulation that bans e-commerce trade on social media. There is no indication so far whether a separate TikTok Shop app will come out of this.TikTok said its priority is to remain compliant with the ruling and will coordinate with the Indonesian government for its next steps.The ByteDance-owned app has stopped facilitating e-commerce transactions on TikTok Shop Indonesia from 5pm Jakarta time on October 4.
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