Indonesia

Indonesia

Indonesia Rural Wireless Broadband (telecommunications)​

Expansion of telecoms network to provide broadband access in rural Indonesia

Nov 2020
Financial close

InfraCo Asia provided
US$15m
of senior debt

US$98.2m
Total investment
(Expansion Phase)


Challenge

Indonesia is the fourth most populous nation in the world, with 258m inhabitants, of which 43% live in rural or remote areas. It is an archipelago nation, comprising more than 17,000 islands, with more than 6,000 inhabited. This has made it difficult economically to deploy cable connection to provide nationwide internet to all citizens, especially on more sparsely populated islands. It is estimated that there are more than 26m people with no, or only 2G, with no connectivity, or only 2G connectivity, across Indonesia.

Solution

  • Net1 Indonesia will roll out a fixed wireless broadband network by installing 1,500 Base Transceiver Stations across rural and remotes areas in Indonesia.
  • This network will use the 450MHz spectrum which can cover a larger geographical area than other commonly used radio frequencies.
  • To finance this roll out, Net1 Indonesia raised US$75m of debt from a consortium of 3 lenders – InfraCo Asia, Finnfund and Gemcorp LLP.
  • Net1 Indonesia is an indirectly owned subsidiary of Net1 International Holdings AS which specialises in delivering broadband connectivity to underserved populations in emerging markets.

Impact

  • New or improved access to digital communications infrastructure for an estimated 450,000 households and Small and Medium Enterprises.
  • Target subscriber group form the last (poorest) quintile of the population.
  • Local medical centres, schools and village head office were lent free router equipment to facilitate communications during movement restrictions due to COVID-19.
  • Women customers are deliberately targeted (currently 52%).
  • The company is now working to support local women shop owners / traders to own and take up management of rural wifi kiosks as an additional source of income.

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