Jakarta. DBS Bank launched its digital banking service, known as digibank, in Indonesia as part of efforts to attract more customers and provide simpler solutions to their banking needs with limited resources.
"We've witnessed a change in customer behavior and people increasingly want a simple, fast and effortless way to bank," Bank DBS Indonesia president director Paulus Sutisna said in a statement on Wednesday (30/08).
Singapore-based DBS Bank currently has more than 280 branches in 18 markets. It has 44 branches in 11 major cities in Indonesia.
"I see DBS only has a presence in big cities in Indonesia," Communications and Information Technology Minister Rudiantara said during the launch on Tuesday, noting that the growing use of mobile phones and the internet has given banks such as DBS the opportunity to reach customers even in the most remote areas where access is difficult and branches scarce.
"It is a must for a bank to have this kind of service," he said. "Fintech empowers banks to reach their customers [...] but tech [also] empowers people to have access to banking services. That is what we need."
According to the Indonesian Internet Service Provider Association (APJII), nearly 52 percent of the country's population, or 132.7 million people, have internet access.
DBS first rolled out digibank in India in April last year, where it has allowed the bank to tap into the country's retail banking market and attract about 1.5 million new customers to date.
DBS's digital banking offering also arrives at an opportune time in Indonesia. According to the Financial Services Authority (OJK), the number of people using e-banking services has increased to 54 million in 2016 from 13.6 million in 2012.
The Digibank Indonesia mobile application, available on App Store and Google Play, offers banking services, such as savings accounts, time deposits and bill payments. It also boasts a spending tracker to monitor and plan spending budgets as well as a virtual assistance feature that can answer customers' questions 24 hours a day.
Although customers do not need to visit a DBS branch to create a digibank account, the service is currently only available to Indonesian citizens living in the greater Jakarta area.
After downloading the app, which is in Bahasa Indonesia to remove the language barrier to new fintech adopters, customers will be required to enter some data, such as their names, email addresses and places of work. However, customers still need to arrange a meeting with a digibank agent to record their biometric data.
Digibank does not currently charge administration fees on transactions or cash withdrawals from the ALTO and ATM Bersama networks. Digibank also offers an interest rate of up to 6.25 percent on 12-month time deposits, compared with the 6.1 percent average paid by other commercial banks.
"A few years ago, we would not have imagined that it would be possible to launch an entire bank in a mobile phone," DBS chief executive Piyush Gupta said in the statement.
"With digibank, we've built a bank that pulls together the power of biometrics, natural language, artificial intelligence and built-in security in one offering."