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Digital banking may help lower interest rates: OJK
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The Financial Services Authority (OJK) has established a Digital Banking Task Force to study the implementation of digital banking services in Indonesia. (Tempo/Tony Hartawan)
T
he Financial Services Authority (OJK) is to encourage bankers to optimize digital banking in their financial services to maximize efficiency, helping to lower interest rates and increase competitiveness.
OJK commissioner for banking supervision Nelson Tampubolon said the optimization of digital banking was in line with President Joko "Jokowi" Widodo's policy to develop the digital economy in Indonesia.
"The optimization of digital technology is expected to increase efficiency in the banking industry, which in turn can lower interest rates," Nelson said after a discussion on digital banking in Jakarta on Thursday, adding that efficient digital banking would speed up financial transactions.
However, certain challenges need first to be overcome, Nelson said, such as the conventional way of thinking in providing financial services, IT investment, additional coordination between bankers and IT providers, security issues and regulatory harmonization.
"Regarding these challenges, the OJK has formed a task force to conduct a review of digital banking and will soon deliver recommendations on digital banking guidelines for national banks," he explained.
The task force, he went on, has communicated with related parties including the National Police's Criminal Investigation Division handling cybercrime and the Financial Transaction Reports and Analysis Center (PPATK).
Nelson said some conditions needed to be met for the development of digital banking, such as the importance of single electronic IDs for building a customer database. In addition, banks must prepare IT infrastructure and implement good risk management and business models, he said.
Cooperation with law enforcers must be improved, he said, as digital banking can be threatened by cybercrime; as such, digital certificates from IT certification authorities are needed, as well as advanced IT security.
"The regulation will be revised in light of the fundamental change from conventional transactions to digital transactions," he added. (ags)
