40m Indonesians have no access to financial industry: BI

The Jakarta Post, Jakarta | Mon, 06/27/2011

At least 40 million Indonesians do not have access to the financial industry, particularly the banking industry, a central bank official has said.

"There are 40 million Indonesians, or 17 percent of our population, mostly low-income people, who still have no access to micro activities at banks," Bank Indonesia (BI) deputy governor for banking research and regulation Muliaman D. Hadad said in Jakarta on Monday.

He was speaking at a seminar titled “Financial Literacy: Toward a National Strategy on Financial Education”, organized jointly by BI and the Organization for Economic Cooperation and Development (OECD).

Muliaman said in order to improve the access to the central bank, in partnership with the OECD, it would push for a financial inclusion policy.

"The global community has spoken of the need for financial inclusion. Financial inclusion is believed to play an important role in improving people's welfare," he said.

Muliaman cited financial education as one program that would be carried out to improve people's awareness on the financial industry.

"Sometimes, lack of access happens because of a lack of understanding. We have worked with the National Education Ministry to improve education on financial issues," he said, adding that the education program also targeted Indonesian migrant workers, housewives and members of religious groups.

Muliaman added BI would call on the banking industry to improve a protection system for its customers to build their trust and loyalty.

OECD deputy secretary-general Richard Boucher said the OECD supported Indonesia's efforts to promote financial inclusion among its people.

"We work together to figure things out; what works, what doesn't work. We have the best people to work together, who can compare and design programs. So, we bring in experience, options and advice, but we don't bring in money," Boucher said. (swd)