June 25, 2015

Global Financial Industry Leaders Gather in Indonesia

Jakarta, May 7, 2015 – Bank Mandiri has promoting collaboration among the leaders of the global financial industry to find solutions to problems related to infrastructure development and the expansion of financial access in Indonesia and Asia. During the opening of the IIF Asia Summit 2015 on Thursday (7 May), Bank Mandiri CEO Budi Gunadi Sadikin said that the international financial leaders were upbeat on economic growth in Indonesia.
Nevertheless, there were a number of challenges facing Indonesia, according to Budi. First, Indonesia faced financial challenges in developing infrastructure in order to accelerate economic growth and boost economic equity. Second, Indonesia also faced the challenge of expanding financial access in society, which currently stood at only 60%. Third, the increasingly stringent global regulatory platform that has emerged in the aftermath of the global financial crisis has affected the availability of capital and resulted in continuously increasing interest rates for the business world. This, in turn, has had an impact on the micro business sector.
Echoing Budi’s comments, Hung Tran, Executive Director of The Institute of International Finance (IIF), expressed the hope that the event would encourage discussion and cooperation among the leaders of the global financial industry in attendance.
Meanwhile, Vice President, Jusuf Kalla said that there was both bad news and good news on the economic front. On the downside, the current annual growth rate of 4.7% was less than the target set by the Government of Indonesia. But, on the upside, Indonesia’s growth rate was much better than other countries in Asia. The forum, according to the Vice President, is very important for developing a dialog and finding joint solutions to the economic issues the region is facing. Indonesia needs better infrastructure to support a variety of economic sectors and improve growth and development. Thus, Indonesia needs greater financing. It was for this reason also that the event was being held.
Bank Mandiri gathered global financial leaders and regulators to discuss how to optimize the role of financial institutions in supporting regional economic development.
The forum serves as an information bridge between the regulators, such as the relevant line ministries, Bank Indonesia and the Financial Services Authority (OJK), and financial industry players in connection with investment opportunities and the investment climate in Indonesia.
The forum was attended and addressed by Finance Minister Bambang Brodjonegoro, Governor of Bank Indonesia Agus Martowardojo and Chairman of the OJK’s Board of Commissioners, Muliaman D. Hadad. Also present were the CEOs of blue-chip financial services companies such as DBS, JP Morgan, Commonwealth, Barclays, Deutsche Bank, Goldman Sachs, Moody’s, Standard Chartered, Bank Central Asia, Bank Danamon, Bank ANZ Indonesia, AIG Insurance Indonesia and hundreds of representatives of Asia’s leading financial institutions.
Among the topics discussed at the forum were Financial Inclusion and New Technology. As in other developing countries, financial inclusion poses major challenges in Indonesia. Latest World Bank data shows around 49% (around 125 million people) of Indonesia’s total population lack access to financial institutions. In this respect, many country’s have made breakthroughs in increasing financial inclusion through collaborative ventures with telecommunications companies, given that the penetration of the telecommunications sector is much deeper than the financial sector.
In Indonesia, the effort to improve financial access are continuing through the development of the digital financial services and branchless banking models, including the payment of assistance funds from public social welfare programs under the 2015 State Budget using digital money. In this regard, Bank Mandiri hass been a pioneer, and currently works together with three telcos to help improve public access to financial services.

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