D

ena, a small businessman in Jakarta, says he does not have a bank account because he never has any money to save.

“I run out of money every time I get paid, so what’s the use of having a bank account?” Dena, who lends money to street vendors to buy equipment, said.

Similar notions — shared by 79 percent of Indonesians, according to a World Bank survey — hinder the development of a savings culture in the nation, which in turn hinders improved financial management, increased wealth and the reduction of poverty.

There are 30 million poor people in Indonesia who also may share Dena’s thoughts, mostly located in rural areas across the archipelago, where poor roads and infrastructure make it expensive and hard to reach city centers to find banks.

Those difficulties have been underscored by a Bank Indonesia (BI) report that said that 62 percent of Indonesian households did not have bank accounts.

The government and local banks, however, want to change that situation.

A plan has been proposed to reduce the number of “financially excluded” people by easing the requirements for opening a bank account and by establishing an infrastructure for “branchless banking” so that customers do not have to be at central locations to deposit, withdraw or transfer funds.

“We will open bank accounts for the poorest people, who do not have any money at all, so that they can learn to save,” according to Bambang Widianto, the vice president’s deputy secretary for people’s welfare and poverty issues.

The government hoped that banking access would ensure that poor people’s finances were more stable, allowing them to improve their welfare, alleviate poverty and sustain the country’s economic growth, Bambang added.

Next year, 500,000 families would be allowed to open savings accounts without a national identity card (KTP), one of the most troublesome requirements for opening a new account, according to Bambang.

“Now, we are focusing on regions that have high supply levels. But by 2014, all regencies will be covered and the total [number of] families will reach three million,” he said.

To help the government meet its target, local banks such as Bank Mandiri, the nation’s largest lender by assets, are preparing the infrastructure for branchless banking based on mobile phones — owned by over 100 million people in Indonesia.

“People can buy mobile phone vouchers for Rp 10,000. Why can’t people store and withdraw funds at voucher agents?” Mandiri president director Zulkifli Zaini told The Jakarta Post in an interview.

The lender is currently conducting a pilot project at its subsidiary, Bank Sinar Harapan Bali, where appointed agents can disburse and accept people’s money like a bank branch, Zulkifli said.

The pilot project might be rolled out on a large scale sometime next year, he added.

“If [the authorities] are not comfortable with the idea of shops acting as agents, it’s ok, the first stage can be done by post offices,” he added.

“We hope to reach out to those that are not touched by the banking world. If branchless banking business succeeds, we can reach 50 to 100 million people in no time.”