SEMARANG: Bisnis Indonesia Daily Newspaper together with PT Bank Tabungan Pensiunan Nasional Tbk (BTPN) held a Media Workshop themed “Financial Inclusion – Opportunities and Challenges for Microfinancing in 2014” in Semarang, on Wednesday (22/1). This event brought together Umar Juoro, an economist from the Center for Information and Development Studies (CIDES), and Daya Head BTPN David Freddynanto.
In his presentation, Umar Juoro said that a large number of Indonesian citizens don’t yet enjoy the benefits of financial services such as transfers, savings or even credit. This was shown in a survey conducted by the World Bank in 2010, which found that only 47% of the total population were savers, while an even smaller figure of 17% were borrowers. In the meantime, the Global Financial Inclusion Index of 2011 revealed that just 19,6% of adults had a bank account. This small proportion of society which uses banks has resulted in a low ratio of deposits to GDP, as well as the lowest ratio of loans to GDP in the region.
Meanwhile, regarding to credit disbursement for Micro, Small & Medium Enterprises (MSMEs), Bank Indonesia (BI) data as of December 2012 indicated that bank financing for the MSME sector stood at Rp 526,4 trillion, or around 19% of total bank credit disbursement which amounted to Rp 2,707,86 trillion. In other words, the penetration of financing for MSME entrepreneurs, especially those in the micro sector, was extremely low.
In contrast, data from the Ministry of Cooperatives and Small & Medium Enterprises recorded that of Indonesia’s total GDP in 2012, the MSME sector contributed around 59%. Furthermore, of the business types that comprise within the MSME sector, micro enterprises make up 90% of businesses with the remainder being small and medium enterprises. This clearly shows that MSMEs play a immensly important role in the Indonesian economy.
According to Umar Juoro, the low financial penetration in the micro sector is driven by a number of factors, such as incapability in accounting and managing their money, a belief that dealing with banks is complicated, as well as a lack of self-confidence in building up their businesses. On the other hand, banks also frequently view the micro sector as being too risky and costly.
“Innovations are needed so that financial inclusion can get underway. Because only by opening up access for people to financial services, they are able to enhance their economic activities and, in turn, become more prosperous. Giving capital loan alone is just not enough; what they really needed is mentoring and increasing their capacities as MSME entrepreneurs,” Umar explained.
Focused and consistent in serving the lower-income segment of the market, as well as micro & small enterprises (mass market), PT Bank Tabungan Pensiunan Nasional Tbk (BTPN) believes that people in the mass market segment are not only require financial access, but also an empowerment program that will train and guide them to enhance their capacities, which willsupport them to obtain sustainable business growth.
Based on this conviction, BTPN has developed the Daya Program, a measured and sustainable mass market empowerment program that represents BTPN’s Unique Value Proposition (UVP). Daya is applied in four BTPN line of businesses, namely BTPN Purna Bakti —business unit that focuses on serving pensioner customers, BTPN Mitra Usaha Rakyat —business unit that focuses on serving micro & small enterprises, BTPN Syariah — which focuses on serving customers from productive poor communities, as well as BTPN Sinaya – which is its funding business unit.
According to David Freddynanto, through the implementation of the Daya Program, BTPN not only provides financial access to its customers, but also makes them more financially literate. Therefore, all customers gain the ability to manage their money and grow their businesses.
BTPN is convinced that the continuous empowerment program will bring positive impact on loan quality and customer loyalty.
“The report from a research done by the of the Management & Business Program of the Bogor Institute of Agriculture (MB IPB) and BTPN in February 2013 showed a positive correlation between the frequency of customers attending Daya programs with the increasing of customer’s business profit and the decreasing of their operational costs. Customers who are discipline in practicing the knowledge that they from Daya trainingsare immediately feel the direct benefits from it,” said David.
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