Banks Get Better Access To Tap Micro Segment

Wednesday, November 26, 2014

The newly launched branchless banking regulation will enable banks to expand their financial services to disadvantaged and low-income segments at affordable costs, a senior official of the Financial Services Authority (OJK) has said.

OJK deputy commissioner on banking supervision Mulya Effendi Siregar said its branchless banking program — called “Laku Pandai” — would provide an incentive for banks wanting to expand their financial inclusion, financial services given to disadvantaged and low-income people.

“They will be able to reach out to new customers easily because they don’t have to open up physical branches anymore. That’s what we offer to the banks,” he said on the sidelines of the OJK’s International Seminar on Financial Literacy for Women and Small and Medium Enterprises (SMEs), held on Tuesday.

Physical branches would require a significant amount of funds that would eventually increase the banks’ operational costs, he said. “With Laku Pandai, they just have to select and appoint agents to carry out basic banking services. Of course, that will reduce costs,” he said.

Source: The Jakarta Post (link opens in a new window)

financial inclusion, microfinance