How to Get to Tomorrow?
Banks need to create a mobile strategy to address their target market of Indonesia's growing digital savvy customer base. The strategy needs to be tailored to diverse customer segments, viewed as a viable substitute to cash, easy and simple to use, and of course, needs to generate value for the banks, as well.
Expect the mobile unbanked - which includes the unemployed, self-employed (such as farmers) and low-wage workers - to be using basic phones that are SMS enabled. For these people, the biggest opportunities are to offer recurring bill payment services and mobile salaries. They may, ultimately, also seek to use peer-to-peer remittances, merchant payments and apply for loans via their phones, which are also options that the banked segments already want.
These offerings aren't pie in the sky. The technology is already available. Take mobile salaries. This is straightforward: an employer sets up a mobile payment system with a bank, on payday the employee receives an SMS confirming payment, while the business owner receives notification of confirmation of payment. Then the employee can use the bank that set up the process to convert the money into cash, remit it or pay bills.
Who benefits? The employee gets the salary faster, the employer has a streamlined system and a happy employee, and the bank that sets this up, potentially has new customers. And it certainly is much safer than carrying money around, which matters because crime rates have, sadly, increased.
As for the SME segment, it would be interested in supply chain and bill payment solutions. Streamlining a small companies' cost of operation is a sure way to align yourself to that company's growth plans.
These are just a few examples of future options but they require banks to start implementing the systems now. The question isn't if it will be done; but rather which banks will take the initiative and gain the first-movers' advantage. Ultimately, the winning banks will be the ones who move fast, and adopt digital business models that drive value rather than just replicate existing channel offerings. Banks that choose to ignore these trends unquestionably do so at their peril.
Hendra Godjali is Accenture's financial services managing director for Indonesia