The Water & Sanitation Crisis in Indonesia
Indonesia is the fourth most populous country in the world and Southeast Asia’s largest economy, with 255 million inhabitants. Average income levels have increased dramatically over the last 20 years, yet more than 33.4 million Indonesians lack safe water, and 99.7 million lack access to improved sanitation facilities.
For millions of low-income Indonesian families, new water connections, water wells and improved toilets are unaffordable without additional financing which helps spread the investment cost over time. Fortunately, there is a growing microfinance sector serving low-income households across the country. There is also an increased recognition among microfinance institutions that financing for water supply and sanitation is a primary customer need and an opportunity to expand services and social impact.
In order to develop and launch sustainable financial products for water and sanitation, microfinance institutions are in need of financial and technical support for market research, product design and testing, customer education, marketing and staff training.
Water.org introduced WaterCredit in Indonesia in 2014. Since then, we have opened an office in Jakarta, hired staff and launched local partnerships with eleven microfinance institutions. We continue to expand our presence by pursuing partnerships with different types of organizations, including partnerships with associations and rural banks.
Water.org sees great potential to scale up our impact by collaborating with water utilities in both rural and urban areas. Community-based organizations are responsible for providing water and sanitation services to rural communities. We provide capacity building training to enable them to achieve sustainable operations and financial viability, in order to secure commercial financing to improve their water services.
We are also exploring new partnerships with urban water utilities to improve their financial services and invest in new water infrastructures to increase their service coverage. These utilities have the potential to provide a significant number of new water connections to urban households, a rapidly growing share of the Indonesian population.