S

tate lender Bank Rakyat Indonesia (BRI) expects to launch its own satellite within the next two years, making it the only bank in Indonesia to cover outer space and water.

BRI, currently the country'€™s most profitable bank, said it urgently needed its own satellite to better support its growing business, especially in isolated areas.

According to BRI president director Sofyan Basir, the satellite would enable its branches to respond to queries faster and provide a better platform for its services.

'€œWe are going to hold a tender for satellite procurement. The whole process will take around two years,'€ he said.

BRI hopes to obtain the Communications and Information Technology Ministry'€™s frequency license soon after the satellite'€™s planned launch in 2016.

At the moment, BRI has the largest branch network and electronic channel coverage among all lenders. It operates more than 9,800 outlets, consisting of branches, sub-branches, cash offices and other units.

Many offices are in rural areas as its business is focused on the distribution of micro loans. The number of offices has surged by more than half from 2009, when it ran 6,341 outlets.

Meanwhile, its latest data shows that the amount of its e-channels '€” composed of ATMs, electronic data capture units, cash deposit machines, kiosks and mobile units '€” had multiplied 10-fold during 2009-2013 to exceed 104,500 units.

'€œThe use of our electronic channels has improved significantly and we need the IT capacity to back these channels,'€ Sofyan said after the bank'€™s annual general-shareholder'€™s meeting recently.

Backed by the thriving e-channel use, e-banking related fees accounted for Rp 673.6 billion (US$59.07 million), or 14 percent of BRI'€™s total fee-based income last year. This was a 78.5 percent year-on-year increase, making it the second-largest contributor to the bank'€™s fee-based income.

BRI was earlier reported to have allocated around $250 million to purchase the satellite, which it insists would be used solely for its banking activities.

It has already obtained the ministry'€™s approval to become a satellite operator under the latter'€™s '€œspecial'€ category '€” under which non-telecommunication firms may apply for permits '€” and to operate the satellite in the 105.5 degrees east longitude orbital slot currently used by telecommunication firm Indosat.

'€œThe functional lifetime of Indosat'€™s satellite in that orbit is estimated to end in 2014,'€ Communications and Information Technology Minister Tifatul Sembiring said when contacted by telephone.

'€œBRI is the only company to submit a permit request for that slot,'€ he added.

Muhammad Budi Setiawan, the ministry'€™s director general for post and informatics resources, said the ministry would grant BRI the frequency license when the satellite was in space.

'€œOnce it is in orbit and connected to the ground station, we will issue the license,'€ he said.

'€œThe sooner BRI completes the procurement process, the better,'€ he added.

In the meantime, BRI is looking to embark on yet another unconventional mission '€” serving residents of riverbanks and coastal areas with its brand new boats.

The '€œfloating banks'€ aim to reach those with little or no access to banking services, according to BRI corporate secretary Muhamad Ali.

During the first stage, which is set to commence in the third quarter, BRI will deploy two boats to the waters around Kalimantan and Maluku.

They will be equipped with similar facilities to normal branch offices, such as teller counters and ATMs.

'€œWe will provide both lending and saving services,'€ Ali said.

'€œThe business potential just for lending is substantial. For example, we may partner with seaweed entrepreneurs.'€

However, he said, BRI had no specific growth target for the floating banks as the initial achievement might be limited.

On land, the publicly-listed bank also plans on widening its coverage this year by opening around 500 more branch offices. By year-end, it will boast more than 10,000 outlets.

'€” JP/Tassia Sipahutar