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Fintech boosts financial inclusion by creating access for unbanked: Survey
According to the 2018 Financial Inclusion Insights survey, 55.7 percent of the respondents had formal financial accounts with banks, fintech companies or cooperatives in 2018.
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Illustration of financial technology (fintech). (Shutterstock/File)
F
inancial technology (fintech) companies, together with the government’s noncash social aid program, have improved financial inclusion in the country by giving more people access to financial services, a recent survey shows.
According to the 2018 Financial Inclusion Insights survey, the results of which were published by the National Committee for Financial Inclusion (DNKI) on Thursday, 55.7 percent of the respondents had formal financial accounts with banks, fintech companies or cooperatives in 2018.
That figure marks a jump in financial inclusion from 35.1 percent in 2016 and moves the country closer to President Joko “Jokowi” Widodo’s target of 75 percent of financial inclusion by the end of this year. If achieved, 75 percent of the country’s adult population would have access to financial services, such as savings, loans, insurance, pensions and payments.
The survey, which involved 6,695 respondents in all provinces of Indonesia, however, revealed that only 38.7 percent of the respondents have bank accounts.
“Digital technology is the enabler of [wider] financial inclusion. As more and more people use smartphones and online payment systems, it has the potential to be the game changer,” DNKI project management head Djauhari Sitorus told reporters on the sidelines of the report’s publication in Jakarta on Thursday.
The survey found that the number of smartphone users reached 70.2 percent of the population in 2018, while smartphone-based electronic transactions had more than quadrupled since 2016.
Financial inclusion is a government priority as it is expected to help boost economic growth, lead to a more even distribution of income, alleviate poverty and increase financial system stability.
