Homemade Banking: E-Money Services Emerge in Indonesia
Summary
TLDRIn Jakarta's outskirts, Mr. Hardianto, a former Navy officer, has transformed his home into a bank branch, offering services for a local electronic money service called 'e-cash'. As a bank correspondent, he enables the unbanked to open accounts, cash in/out, transfer funds, and pay utilities, all through their mobile phones. Despite regulatory challenges and limited marketing, Hardianto has opened over 500 accounts since 2014, promoting financial inclusion in Indonesia where most people rely on cash and lack bank accounts.
Takeaways
- 🏢 The script discusses a local electronic money service called 'eash' that operates in Jakarta's outskirts, serving as a bank branch for the unbanked population.
- 👤 Mr. Hardianto, a former Navy officer and community leader, acts as an agent for 'eash', providing banking services to his neighborhood through his mobile phone.
- 📲 Customers can receive money directly into their mobile phone accounts, which they can use for various transactions, such as buying phone credit and paying bills.
- 🏦 Bank Mandiri is involved in this initiative, aiming to reach the 160 million unbanked Indonesians, with over 2000 agents and a focus on branchless banking.
- 📈 The service is part of a government effort to democratize banking services, especially in areas where people primarily use cash and do not have bank accounts.
- 📈 There is a significant potential market, with around 180 to 200 million mobile subscribers, which could be converted into banking customers.
- 🏘️ The service is particularly beneficial for low-income communities, who traditionally have limited access to banking services.
- 🚫 Regulatory confusion and uncertainty are barriers to the expansion of mobile money services, limiting advertising, marketing, and the establishment of agent networks.
- 📈 Mr. Hardianto has successfully opened over 500 electronic money accounts since October 2014, indicating the service's acceptance in his community.
- 📚 Education is highlighted as a key obstacle to the adoption of branchless banking, suggesting a need for increased financial literacy.
- 🔢 Transactions are currently limited to less than 50,000 rupiah, and eash accounts do not offer interest, which may restrict the service's appeal and utility.
Q & A
What is the main service provided by Mr. Hardianto in his neighborhood?
-Mr. Hardianto provides services as an agent for a local electronic money service called 'eash,' allowing customers to credit money into their mobile phone accounts, buy phone credit, pay electricity bills, and purchase supplies at local stores.
How does the eash service benefit the unbanked population in Indonesia?
-The eash service benefits the unbanked population by offering a no-frills, no opening fee, and no minimum balance electronic money account that they can manage remotely through their mobile phones.
What is the significance of Mr. Hardianto's role as a bank correspondent?
-As a bank correspondent, Mr. Hardianto facilitates financial transactions for those without bank accounts, making banking services more accessible to the community and promoting financial inclusion.
How does the eash service work for customers who want to open accounts or make transactions?
-Customers can visit Mr. Hardianto's place to open accounts, cash in and out, transfer funds, and pay utilities, similar to a bank branch but run by a third party instead of directly by Mandiri Bank.
What is the demographic that Mr. Hardianto primarily serves, and why are they unbanked?
-Mr. Hardianto primarily serves the lower-middle class and below, who are unbanked due to various reasons, including lack of awareness about banking services and not having a bank account.
What is the role of mobile phones in facilitating branchless banking in Indonesia?
-Mobile phones play a crucial role in branchless banking by acting as a medium for people to access banking services remotely, such as opening accounts, making transactions, and paying bills, without the need for a physical bank branch.
How does the eash service address the issue of regulatory confusion in the mobile money industry?
-The script does not provide specific details on how eash addresses regulatory confusion. However, it implies that simplifying the rules and reducing regulatory uncertainty could help expand services like eash.
What are the limitations Mr. Hardianto faces in promoting eash accounts in his community?
-Mr. Hardianto faces challenges such as limited interest from the community, regulatory confusion, and restrictions on transaction amounts, which are capped at less than 5 million Indonesian Rupiah.
What is the potential number of electronic money accounts in Indonesia based on mobile subscribers?
-The potential number of electronic money accounts in Indonesia is estimated to be around 180 to 200 million, based on the number of mobile subscribers in the country.
How does Mr. Hardianto use his role as a religious leader to promote branchless banking?
-Mr. Hardianto preaches about the benefits of branchless banking during local mosque gatherings, using his influence as a religious leader to educate and convince the community about the advantages of using eash services.
What are the educational obstacles preventing the widespread adoption of branchless banking in Indonesia?
-The script suggests that a lack of education about the benefits and usage of mobile money services is one of the obstacles preventing the widespread adoption of branchless banking in Indonesia.
Outlines
🏦 Community Banking Transformation
The script describes the innovative banking practices in a poor neighborhood in Jakarta, where a former Navy officer, Pak, has turned his house into a bank branch-like service center. He acts as an agent for a local electronic money service called 'eash', allowing customers to perform banking transactions through his mobile phone. This service is particularly beneficial for the unbanked population, who can now open accounts, cash in and out, transfer funds, and pay utilities without the need for a traditional bank account. The government's initiative aims to bring financial products to the 160 million unbanked Indonesians, leveraging the widespread use of mobile phones. The script also mentions the potential for growth in this sector, with the number of mobile subscribers indicating a possible 180 to 200 million users.
📢 Outreach and Challenges in Branchless Banking
This paragraph discusses the challenges faced in promoting branchless banking in the community, despite the efforts of Mr. Harianto, who also serves as a religious leader. He attempts to educate the community about the benefits of electronic banking during local mosque gatherings. However, the uptake is slow due to limited understanding and the current restrictions on transaction amounts and lack of interest on eash accounts. The script highlights the need for education and regulatory clarity to expand the reach of mobile money services, which could include micro loans and insurance. The manager of Bank Mandiri suggests that simplifying the rules could pave the way for new financial products and services.
Mindmap
Keywords
💡Asalamualaikum
💡Bank branch
💡Bank correspondent
💡Unbanked
💡Electronic money
💡Mobile phone money account
💡Branchless banking
💡Agent
💡Regulatory confusion
💡Micro loans and micro insurance
💡Education
Highlights
A former Navy officer in Jakarta has turned his house into a bank branch for the poor neighborhood, offering services at all hours.
He is an agent for a local electronic money service called eash, allowing customers to credit money to their mobile phone accounts with a few clicks.
Customers can use the electronic wallet to buy phone credit, pay electricity bills, or buy supplies in local grocery stores.
The unbanked population in Indonesia is 160 million, with 60% of the population owning a mobile phone.
Mobile money subscribers can choose from several platforms to get no-frills, no opening fee, no minimum balance electronic money accounts.
These mobile wallets are expected to democratize banking services in Indonesia, where most people still use only cash and don't save money due to lack of bank accounts.
Bank Mandiri has more than 2,000 agents for branchless banking as part of a government effort to bring financial products to the unbanked population.
The agent network allows unbanked customers to open accounts, cash in/out, transfer funds, and pay utilities, similar to a bank branch but run by third parties.
The agent in the transcript has been a trusted community leader for a long time, which makes him a reliable eash agent for Bank Mandiri in the area.
Education is one of the obstacles preventing branchless banking from taking off, as many people are not familiar with the concept.
Regulatory confusion is making it harder for mobile money providers to expand their services due to uncertainty in advertising, marketing, and agent network creation.
Simplifying the rules for branchless banking would open the way for offering new products like transaction bases and saving accounts, as well as micro loans and insurance.
The agent also preaches about the benefits of branchless banking at the local mosque, trying to convince the community of its advantages.
Transfer limits are currently set at less than IDR 50,000, and eash accounts do not pay interest, which may limit their appeal and use for larger transactions.
The agent has opened more than 500 electronic money accounts since October 2014, showing the potential for growth in branchless banking in Indonesia.
The government and financial institutions are working to bring banking services to the unbanked population, making financial inclusion a priority.
Mobile money accounts have the potential to reach around 180-200 million users in Indonesia, based on the number of mobile subscribers.
Transcripts
Asalamualaikum
Asalamualaikum Maaf Pak selamat malam
gangguubungang saya senang sekali bangga
bisa melayani bisa memberikan bantuan
ini adalah pengamalan saya melayani
terhadap masyarakat apa saja
malam-malam Pak Iya ini e apa
tabungannya lagi kosong besok mau
belanja Pak ke warung untuk sembako gitu
jadi harus diisi Dulah gitu mrant has
turned his house in Jakarta outirts into
a kind of bank branch in this poor
neighborhood the former Navy officer
offers Services at all hours He's An
Agent for a new local electronic money
service called eash with a few Clicks on
his keyboard the bank correspondent
credits,000 rupas less than 8 to this
man's mobile phone money account masuk
Pak udah masuk Pak ini e dapat SMS dari
Mandiri his customer can now use the
electronic Wallet to buy phone credit
pay electricity Bills or buy supplies in
some local mom and pop grocery Stores
masyarakat diini memang sangat kecil
sekali hubungan ke bank karena di sini
adalah masyarakatnya menengah ke bawah
Bahkan mereka tidak memiliki rekening
bank jadi fungsi handphone ini nomornya
itu sama dengan nomor rekening bank the
unbank customers go to this Agents and
they can open accounts They can Cash in
cash out They can do fund transfer They
can also pay utilities just like a
branch but Run by third party inad of
directly by Mandiri Saya kenal pakiantos
sudah lama beliau ketua RT di daerah
sini maka saya percaya banget beliau
jadi agen ees Mandiri di wilayah ini
saya dekat dari rumah ini jadi makanya
saya ke sini gak perlu Kebang lagi gitu
terima kasih
Asalamualaikum Bank Mandiri has more
than 2000er lo AG
branchless banking is part of a
government effort to bring financial
products to the 160 Million unbanked as
60% of the population Owns a mobile
phone mobile Money subscribers can
choose Among a handful of platforms to
get no frills no opening fee no minimum
Balance electronic money accounts that
they can manage remotely these kinds of
mobile wallets are expected to
democratize banking Services in
Indonesia where most of people still use
only Cash and don't save money as they
don't have a bank account currently we
have 60 7 Million saving accounts in
Indonesia I think the potential if we go
by the number of mobile subscribers it
has to be around 180 to 200
Million making the rounds in one of the
country's poorest slums Mr Hardianto has
already opened more than 500 electronic
money accounts since october
2014 the 60yearold agent has an
Asalamualaikum Waalaikumsalam
iya Bu apa kabar Baik Pak silakan Nah
jadi handphone ini nah ini dipakai untuk
gantinya uang kertas e cas Iya itu
sangat cocok Iya dengan rumah
tangga seperti Ibu saya enggak punya
uang
buatya berapa saja iklannya adalah
gratis tanpa setoran dengan adanya
mereka sudah bisa memasukkan itu berarti
sudah dia menjadi
nasabah ini kita
masuk bisa baca
Education is one of the obstacles
preventing branchless banking from
taking
off for those who provide mobile money
products regulatory confusion is making
it Harder to expand their Services They
can set up their technology but the
spending on Advertising on marketing on
creating An Agent Network has been
limited because of regulatory
uncertainty for the manager of state Run
Bank mondiri simplifying The Rules would
Open the way for offering new products
from transactions bas to saving accounts
and then we can also crossell to them
the micro loans micro
insurance every Monday at the local mosk
men gather After The Prayer on one night
in May Mr Harianto Who's also a
religious leader preaches about the
Benefits of branchless banking
hari libur gak bisa kalau sini di rumah
sambil tiduran pencet-pencet bisa I
think this program is very surprised we
are support the help of the people
Indones still Harianto Finds it hard to
convince majority in his community
transfers are limited to less than00 and
for now eash accounts pay no
interest maksimal hanya 5 juta
sehinggai melakukan bisnis itu mungkin
agak terhambat e ketertarikan dengan Ik
ini mungkin belum saya karena saya lihat
manfaatnya belum luas
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