MasterCard plans to promote online payments in the still cash-dominated Indonesian economy.

The card brand has teamed up with Indonesian E-commerce Association (idEA) to launch an online shopping festival running through January 2015, aimed at promoting the use of digital payment.

The shopping festival will be participated by 14 online retailers including Lazada, Zalora, Groupon and LivingSocial.

E-commerce in Indonesia is booming, however, online payments remain low, with most consumers paying cash on delivery of products.

MasterCard Indonesia country manager Irni Palar said cash (37.9 per cent) is still the most used payment mode, followed by bank transfers 27.5 per cent and credit card payments (10 per cent).

idEA vice chairman Agus Tjandra forecasts there will be 5.7 million online shoppers by the end of the year – up from 4 million in 2013.