VOI - Voice of Indonesia | RRI - Radio Republik Indonesia

VOINews, Jakarta - The ASEAN digital finance initiative has made a significant contribution to the acceleration of financial inclusivity in the region. Over the past few years, State-Owned Enterprises (SOEs) have played a crucial role in guiding the transformation amid the booming development of digital finance.

This was stated by the Deputy Minister of SOEs, Rosan Roeslani, in a statement received by the Communications and Media Team of the 43rd ASEAN Summit, on Wednesday, 6 September 2023 in Jakarta. ASEAN, as home for 680 million people and 70 million SMEs, is still faced with significant challenges in financial inclusivity.

The level of public awareness of transactions and the use of banking services is still low, with up to 70% of the unbanked population. Moreover, around 39 million out of 70 million SMEs also face a substantial funding gap of US$300 billion annually. Vice Minister of SOEs, Rosan Roeslani, explained that in the midst of this situation, the emergence of digital financial services paves the way to bridge the financial gap, especially for those of the unbanked population, who do not use banking services, and also for SMEs that may have been previously considered unbankable. Digital financial services are crucial in promoting financial inclusivity and serve as the foundation for sustainable and inclusive economic growth in the ASEAN region.

"We’ve seen examples in ASEAN countries that the digital financial growth and revolution have boosted the country's economy and economic inclusivity. Similar developments have also occurred in Indonesia in recent years, where Indonesia has been at the forefront of the digital financial revolution, demonstrating remarkable growth and resilience," said Rosan.

Rosan revealed that between 2011 and 2022, the number of financial technology users in Indonesia increased sixfold from 51 users to 334 active users.

Meanwhile, 33% of the population chose e-wallets as their default payment method in 2021. This has put Indonesia in the same position as some developed countries in Asia.

"Indonesia's transition to digital economy is apparent with the surge in non-cash payments from US$813 million to US$26.2 billion from 2017 to 2022. The transition to a rapidly growing digital transaction ecosystem is reflected in the value of digital payment transactions, which rose from US$206 billion in 2019 to US$266 billion in 2022," explained Rosan.

He continued, that the growth in digital payment transactions is expected to continue to rise, reaching over US$421 billion by 2025.

With its wide reach, SOEs play a crucial role in promoting financial inclusion through digital finance, especially in less accessible cities. Over the past few years, SOEs have acted as catalysts, initiating visionary initiatives and forming strategic collaborations to transform Indonesia's digital financial services in various aspects. From the ASEAN perspective, in recent years, the ASEAN digital financial sector has also undergone a transformation, mainly aimed at strengthening financial inclusion for consumers and SMEs.

Growth in this field is robust, with an increase in digital payment volume. Meanwhile, the landscape of digital finance is also catching up and is expected to grow significantly by 2030. In response to this phenomenon, SOE banks are now focusing on three transformations, including digital lending, digital payments (e-wallets), and digital banking.

In digital lending transformation, BRI, Bank Mandiri, and Bank BNI have launched digital lending platforms that allow individuals with no lending history to access financial services digitally. This initiative has had a significant impact on financial inclusion. The BRI digital lending, for example, grew by 146% in one year from 2021 to 2022, with a loan value of US$125 million to millions of lenders in the first three quarters of 2022.

"Furthermore, for digital payments (e-wallets), several SOEs have expanded payment services through e-money platforms. Lastly, for digital banking, Bank Mandiri, BRI, BNI, and BTN have also developed digital banking solutions, including BNI's mobile banking, which grew by 59.6% year on year to 7.8 million users in 2020," explained Rosan.

Financial inclusivity is not only merely the goal of the economic sector, it is also for the best interest of society.

"We sincerely hope that the discussions in this forum will yield solutions to the financial inclusivity challenges we face in the region, in order to maintain stability and prosperity in the ASEAN region," concluded Rosan.