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Cashless: Can Indonesia go Swish?
It is in the interest of banks to push people to transact more over internet.
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It is in the interest of banks to push people to transact more over internet. (Shutterstock/File)
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wedish people do not like to use cash. Credit and debit cards are preferred. When not using the card, a mobile app Swish built by its banks which allows customers to transfer money to each other via a phone number is employed.
Things have reached such a point that many shops refuse to accept cash and churches accept donations through card. Bank branches are visited scarcely. This distaste for cash has led to the currency in circulation dropping by 40 percent since its peak of 2007. Banks are not complaining. The cost of maintaining cash is high as compared to cards. So is maintaining a vast branch network, several of them which are not profitable to keep.
Sweden is at the vanguard for what the future of banking might look like. Even other developed nations lag behind the nation of 10 million people. Emerging markets like Indonesia are at the other extreme currently in their desire for using cash as a mode of payment. That’s not surprising since only 20 percent of the population have access to banking services currently. Yet given the technological explosion underway this decade it seems unlikely that this trend will continue for long. 30 percent of the population already owns a smart phone and almost all those owners access internet through their handset.
Given the model followed in other large populated developing nations, the formula is now well established and Indonesia should leverage on that advantage. Government led initiative to ensure that citizens open a bank account through the right incentives (subsidy benefits credited only into bank accounts) and the support of private mobile phone manufacturers who will make their phones more affordable to the population.
