Date post: | 01-Jan-2016 |
Category: |
Documents |
Upload: | harriet-dinah-lewis |
View: | 215 times |
Download: | 1 times |
Bank Indonesia policy on Financial Inclusion
The 1st International Islamic Financial Inclusion Summit 2012
Dr. Muliaman D Hadad
Outline
• Facts and Figures • BI Household Survey • National Strategy on Financial Inclusion • Bank Indonesia Initiatives on Financial Inclusion • Challanges Ahead
Fact and Figures
Some key facts of Indonesia:– Population of Indonesia: 237 million– GDP per capita: USD 3,508– Banking industry holds more than 80% of financial sector assets– 97.4% of banks accounts are less than Rp100 million (less than USD10,000)– Number of commercial banks: 120– Number of rural banks: +1.667– Number of cooperatives: +13.000– Number of microfinance institutions: +8.000
Category Quantity Percentage on Total Population
Population 237.641.326 Number of Loan Account 37.929.527 15,96%Number of Insured life Insurance 34.564.028 14,54%Number of pension fund participant 2.817.997 1,19%
Public access on financial services is relatively low that is reflected by (a) the number of loan accounts which reach only 15.96% of the population, (b) the number of insured life insurance which reach only 14.54% and (c) the number of pension fund participants which is only 1.19 %
No Indikator Indonesia Malaysia Thai Phil Brazil
1 Financial Services Utilization*) (Percentage of Total Population)
Account at Formal Financial Institution 20% 66% 73% 27% 56%
Adults saving in the past year (using Formal Account) 15% 35% 43% 15% 10%
Adults Originating a new loan in the past year (Formal Financial Institution)
9% 11% 19% 11% 6%
Adults With Mortgage 1% 13% 5% 4% 1%
Adults paying personally for health insurance 1% 16% 24% 5% 8%
2 Banking Services Access**)
Number of Bank Branch per 1.000 km2 7,71 6,18 11,59 15,69 2,33
Number of Bank’s Branch per 100.000 adult population
8,32 10,48 11,16 7,69 13,76
Number of ATM per 1.000 km2 12,39 33,12 80,68 30,35 20,46
Number of ATM’s per 100.000 adult population 13,37 56,18 77,69 14,88 120,62Source : *) WorldBank Policy Research Working Paper, April 2012**)IMF & WorldBank, 2010
Financial Services : Comparison
ACCESS TO FINANCE IN INDONESIA
Below Poverty Line
Living in Rural Area
13.33% 64.25%
Without access to bank
60%
% MSME compare to total business
unit
99.91%
MSMEs that have not been linked to bank
60-70%
5
Outline
• Facts and Figures
• BI Household Survey • National Strategy on Financial Inclusion • Bank Indonesia Initiatives on Financial Inclusion • Challanges Ahead
Save in bank, non bank institution,
Non Financial Insti-tution
39%
Do not have saving ac-
count 62%
2010
Save in bank, non bank institu-tion, Non Finan-cial Institution
48%
Do not have sav-ing account
52%
2011
BI HOUSEHOLD SURVEY : Saving
BI HOUSEHOLD SURVEY : Saving
Save in Bank Save in Non Bank Financial Institution
Save in Non Financial Institution
34.72%
3.78%2.57%
43.57%
6.06%
3.30%
2010 2011
9
With Loan 45%
Without Loan 55%
2011
With Loan 41%
Without Loan 59%
2010
BI HOUSEHOLD SURVEY : Credit
BI HOUSEHOLD SURVEY : Credit
10
Loan from Bank Loan from Non Bank Financial Institution Loan From Non Financial Institution
18.21% 17.84%18.46%
19.58%
16.04%
24.37%2010 2011
Outline
• Facts and Figures • BI Household Survey
• National Strategy on Financial Inclusion • Bank Indonesia Initiatives on Financial Inclusion • Challanges Ahead
National Strategy on Financial Inclusion
12
Mission
Vision
13
Financial Inclusion Framework
: On going Programn by BI
: Program will be conducted by BI: Paralel program with other
institutions outside of BI
Remarks Infrastructure
Financial Access to Bank andNon-Bank Financial Institutions
Saving
Credit/ Financing
Insurance related to Credit
Payment System
Other financial Services for MSMEs
Main Products
Fin.Education & Customer Protection
Mapping on Financial
Information
Intermediation Facilitation
Distribution Channel
Supporting Policy &
Regulation
Strategic Target
14
Financial Education
The Improvement of financial literacy on: a. Banking products ;b. Consumer Protection;c. Financial management
Financial Eligibility
Increasing the number of eligible/bankable person or SME’s
Policy and Regulation
Preparing the regulation that support financial access and eliminating the various types of barriers
Intermediation
Increasing the range of formal financial system especially to remote areas community
Distribution Channel
Increasing the financial distribution channel in terms of number and quality
Outline
• Facts and Figures • BI Household Survey • National Strategy on Financial Inclusion
• Bank Indonesia Initiatives on Financial Inclusion • Challanges Ahead
16
Financial Education and Customer Protection Programme
Financial Education for Student & Migrant
Workers
Financial Planning
Financial Literacy Survey
• School curricula• Pilot Project in 6 provinces for elementary & junior high school
• Joint workshop & expanding outreach• Financial education for migrant workers in 5 provinces• Establish local financial education team
• Basic Saving Account with no administrative charges• TabunganKu, targetted to achieve 5 million account and Rp5
trillion by end of 2012• Campaign of TabunganKu
• Joint effort, Bank Indonesia and banking industry
• Policy recommendation on financial education• Fine tune financial education programme
Pillar 1 - Education
Financial Education and Customer Protection Programme
17
Financial Mapping & Intermediation Facilitation Programme
Financial Identity Number
• Baseline and comprehensive surveys• Database of individuals’ financial track record
• Integrated with national identity database
Pillar 2 - Eligibility
Pillar 3 - Intermediation
Financial Mapping & Intermediation Facilitation Programme
Start-up Credit • Affordable credit scheme for new entrepreneur and
productive poor• Cooperation with related governmental institutions
18
Distribution Channel and Supporting Regulation Programme
National Strategy for Financial
Inclusion• Guidance for implementing financial inclusion
initiatives• In the process of endorsement from the President of the
Republic of Indonesia
Pillar 4 - Distribution
Pillar 5 - Regulation
Distribution Channel and Supporting Regulation Programme
Branchless Banking• Expanding access into remote area
• Agent banking, mobile banking, electronic banking• IT Based infrastructure
Outline
• Facts and Figures • BI Household Survey • National Strategy on Financial Inclusion • Bank Indonesia Initiatives on Financial Inclusion
• Challenges Ahead
Challenges Ahead
Supporting Regulation
• Regulation to protect the rights of MFI consumer
Financial Eligibility
• Revisit regulation related to the opening of bank account for lower income people
• Regulation to promote start up credit : should deal with bank prudential regulation.
Problems Identified Pillars Proposed Program
Lack of Customer Protection Framework for MFI Customer
Lower income people is categorized as unbankable since they can not fulfill bank requirement
Challenges Ahead
Problems Identified Pillars Proposed Program
Education• Coordination and cooperation with
the educational authorities• The promotion of saving habbit to
the school students
Intermediation Facility
• Policy to promote linkage program which satisfy the banks and MFIs
Distribution Channel
• Regulation on Branchless banking : to support and to protect customer and banking industry.
Accelerating Financial education Program
Banks and MFI compete in the same segment
Financial services for people in remote are
Thank You