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ublicly listed telecommunications company PT Telekomunikasi Indonesia (Telkom) and state-owned lender PT Bank Tabungan Negara (BTN) inked a deal on Wednesday to improve Telkom’s Delima remittance business.

“Telkom is one of the non-banking institutions that have obtained permission to conduct remittance services. Despite existing remittance service providers, we are confident that we will become the leader in the market, because we have a strong network,” Telkom information technology director Indra Utoyo said.

US-based Western Union remains the most popular money transfer service in the nation, favored by Indonesians working overseas to send money back home. State-owned postal service PT Pos Indonesia also provides remittance services in cooperation with several banking institutions.

According to Indra, Delima started about one-and-a-half years ago and now processes from Rp 2 billion (US$209,096) to Rp 5 billion a month, domestically.

Its international service has processed around Rp 1 billion a month, mostly remittances from Malaysia and Hong Kong, since the service was launched in January.

According to Bank Indonesia, remittances from overseas workers are expected to reach Rp 65 trillion by year-end, about Rp 15 trillion of which will be processed by non-bank instructions.

Customers can send up to Rp 5 million a day and Rp 20 million a month through Delima, in accordance with central bank regulations.

Under the agreement, people with or without bank accounts will be able to send money through Delima. The service is available at BTN offices across the country and institutions with a Delima logo.

BTN president director Iqbal Latanro said that the firm cooperated with Telkom to improve its service.

“Currently, many banks are trying to give additional services to their customers, partly by cooperating with other companies that will give added value to the services. We see that Delima has good prospects,” Iqbal said.

Besides cooperating with BTN, Telkom has established similar agreements with lender PT Bank Rakyat Indonesia Syariah and with minimarket network Alfamart.

Prior to signing its cooperative agreement with BTN, Telkom provided Delima service in around 730 of its Plasa Telkom outlets and at about 25,000 cash points across the country.

Following the signing of the agreement, Telkom will likely have to add hundreds of new spots for Delima services, as BTN now has 65 conventional branches and 218 supporting branches, 22 sharia branches and 21 supporting sharia branches as well as 367 cash offices.

—JP/ Raras Cahyafitri