Erwin Riyanto: Financial inclusion for SME in Indonesia

Talking points by Mr Erwin Riyanto, Deputy Governor of Bank Indonesia, at the Regional Forum on "Emerging opportunities and challenges of financial inclusion", Kathmandu, 9 November 2016.

The views expressed in this speech are those of the speaker and not the view of the BIS.

I. Introduction

1. A very good afternoon and warm greetings to:

a. Mr. Shitangshu Kumar Sur Chowdhury, Chairman of APRACA;

b. Mr. Shiba Raj Shrestha, Vice Chairman of APRACA;

c. The member of APRACA;

d. Ladies and gentlemen.

Distinguished guests,

2. We are all aware that financial inclusion has become a priority in the world, but it has now also been considered as national agenda for Indonesia.

3. In this honorable meeting, I would like to share Indonesian's experience regarding the financial inclusion in Indonesia, and its relation to SME.

Ladies and gentlemen,

II. Current condition in Indonesia 

4. Considering the current condition, Indonesia with its population of almost 250 million people which 28 million people living in poverty line remains to be unbanked. Taking a closer look these large portion of the unbanked clustered around poverty line remains vulnerable. Geographic condition adds the challenge in providing access to this target group as Indonesia consist of almost 17.000 island and most of poor people live in a very remote area with different culture. On the supply side, there are several factors inhibiting services to the community such as limited communication network and electricity infrastructure.