Therefore the banking sector will remain backbone of financial inclusion. Bank will continue to play a major role in the provision of financial services. For this reason it’s important to see how the branch networks can be strengthened and expanded to reach greater proportion of population.
Moreover with the help of technology can enable some of the most important bottlenecks to overcome and increase the supply of financial service. Through technology consumers can carry out banking without ever stepping into a bank. This convenience can be great incentives for consumers to have a bank account. Information and Communication Technology can also reduce transaction costs and expand the formal financial system outreach in regards to saving and loan services.
As a result branchless banking in the form of mobile phone banking (i.e. mobile money), internet banking or transaction using a card or electronic machine are technological breakthrough with huge potential for extending the coverage of financial service to consumers who are not yet served by the banking sector.
The good thing is there is high access of Indonesians residents to cellular telephone technology makes it very convenient to increase access to financial services through the technology. This innovation could be combined with-money services, utilizing retail networks as outlets for banks.
[caption caption="BCA and Indepay Network signings (doc: Ben B. Nur)"]
Launching Low-cost Payment Network through Local Agents
For this reason one of the biggest private bank in Indonesia known as Bank Central Asia (BCA) takes commitments to improve the services for the people living in rural and less populated areas. They intend to strengthen the financial inclusion with this recent plan known as branchless banking system. As we all know throughout the years BCA has held an impactful stance upon Indonesia’s economy in banking.
In this attempt to connect to the customers through branchless banking system, BCA has paired up with Indepay Network, accompany that have based in Singapore and specializes in doing such. Both companies have signed a cooperation agreement to launch Low-cost Payment Network. Previously Indepay has been operating in India since 2007 with aims of easing up the transaction process through a payment network.
The collaboration of the two companies was done on Monday the 21th of December 2015 when Indepay signed a Cooperation Agreement at the BCA Building Nusantara on Jalan Thamrin Jakarta. The BCA was represented by the Director of BCA, Suwignyo Budiman and Indepay Network represented by Rajib Saha, the CEO of Indepay Network. This signing agreement was also witnessed by Independent Commissioner of BCA, Cyrillus Harinowo; BCA Director, Henry Koenaifi and Vice President of Indepay Network, John Lee.
In his speech after the signing of the cooperation, Suwignyo explained that BCA and Indepay has long been exploring each other to ensure that this cooperation can provide maximum benefits for BCA customers in Indonesia. During the signing Suwignyo discussed about plans for a pilot Project to take place a small trial for testing services through branchless banking with the use of agents in Grobogan, Central Java and Cigugur West Java.
So far BCA has long focused on their services in urban areas while Indepay is effective in providing support without the usage of bank branches. Rajib Saha also said that transactions can be made without having to travel far from their (customer) homes. Although it is true that having personal agents can be costly, the services will make up for the relatively small cost, replied Suwignyo when asked on the matter.
