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Jakarta Post

Are fintech companies really bad for banks?

  • Arisyi Raz
    Arisyi Raz

    Analyst from the Macroprudential Policy Department of Bank Indonesia

PREMIUM
Jakarta   /   Tue, January 2, 2018   /  12:29 pm
Are fintech companies really bad for banks? President Joko Widodo and Finance Minister Sri Mulyani Indrawati observe a digital panel display in Fintech Festival in Jakarta on Aug. 30 2016. (tempo.co/File)

Given the hype over the fintech industry nowadays, many analysts, business professionals and even bankers are concerned about its impact on the conventional banking system. They fear that this industry will be disruptive to the banking system. Their arguments have valid points, but in many cases the concerns are overstated. Stating the fintech industry will disrupt the market for the banking sector is not a far-fetched argument, but is not something that is going to happen so easily within a short time. In an event held at Ritz Carlton Jakarta on Nov. 8, Reynold Wijaya, the CEO and co-founder of Modalku, one of the biggest P2P fintech firms in ASEAN, admitted that the fintech business is not intended to compete with the well-established banks because of different business visions and goals. Indeed, the mushrooming of fintech start-ups in the last couple years will affect the ...

Disclaimer: The opinions expressed in this article are those of the author and do not reflect the official stance of The Jakarta Post.