BANKING POLICY DIRECTION A. Banking Policy Direction in 2013

36 and this micro inancial institution becomes one of the successful keys to realize inclusive inancial institutions for the whole society. National Strategy of Financial Inclusion The enhancement of public access to the said inancial institutions is naturally a complex problem so that it needs a cross sectoral coordination involving banking authorities, non-bank inancial services and other concerned institutions toward poverty alleviation and education. Therefore, a comprehensive policy is required in the national strategy of Indonesia. In this connection, 6 pillars of policy in inancial inclusion are formed as referred in below illustration. Figure 3 - Pillar of Financial Inclusion Description of the above pillars is as follows: One of the protection forms for consumers is by providing inancial education to the society as relected in the First Pillar , namely the pillar of inancial education. Financial education is an activity to enhance public knowledge to inancial poducts and services. The improvement of knowledge becomes one of the pillars in the activities of inancial inclusion, considering one of the reasons why the community does not interact with inancial institutios is the lack of public understanding in inancial products and 37 services. Some activities have been conducted by BI related to inancial education, among others are: “Ayo Ke Bank” Let’s Go to the Bank campaign, provision of information website and consumer education as well as the inclusion of inancial education in the curriculum of elementary and junior high schools SD and SMP in Bandung, Semarang, Surabaya, Medan, Makassar, Banjarmasin and Palu as pilot projects. In year 2013, education activities to the communities will continue to be conducted, focusing on the above seven pilot project regions at a minimum. Education on banking and entrepreneurship are also conducted to Indonesian Labors in foreign countries TKI. Joint campaign of the whole Indonesian banking will also continue to be conducted through a save student movement and a banking product of Tabunganku my Savings. Second Pillar is public inancial facilities that explor the role of the Government through direct or indirect inancing in order to encourage community economic empowerment. The products including in this pillar are among others Cash Direct Assistance BLT, Social Assistance Bansos, Aspiring Family Program PKH, Public Health Insurance Jamkesmas, Rice for the Poor Raskin, and other forms of subsidy. Channelling of this government support basically takes into consideration the principles of prudential, right on target, and beneits of such budget allocations. Third Pillar is related to the mapping of inancial information inancial eligibility, in which one of the public constraints in connecting with inancial services is due to individual issues of the communities such as legality issues. This is relected by the fact that many MSMEs are still not incorporated and do not have business licenses which are prerequisites for credit provision by Banks. Hence, this pillar aims to enhance the feasibility of the poor productive from not feasible to become feasible and then bankable at the inal stage. This pillar consists of several aspects, among others to enhance community capacities, introduce alternative security system and simpler credit services, and also identify potential customers. In this case, BI has developed MSMEs cluster and also conducted initiation of credit rating formulation of MSMEs as well as 38 Financial Identity Number FIN. To motivate public access toward inancial services, a study is required upon the provisions that can support public easy access to inancial services, which covered in the Fourth Pillar, namely policiessupporting regulations. In this pillar, the Government and BI will make eforts to provide supports in a policy in the form of regulations issuance that can facilitate the communities in obtaining inancial services. BI in year 2012 has issued multilicense provision. Meanwhile, the policies that will support the facilitation of inancial services among others are policies of branchless banking and credit start-up. Fifth Pillar observes the importance of facilitating intermediation and distribution which emphasizes on the eforts to increase awareness of inancial institutions toward the community groups’ potential to get inancial services. BI, in its efort to enhance the facilitation of intermediation, in cooperation with Indonesian banking has developed “TabunganKu” product which is a form of savings with a low administration cost. Eforts to increase the outreach of formal inancial institution services to the community groups in rural areas are conducted through branchless banking in which one of them contains the possibility of a mobile money application in Indonesia, whereas cellular phones can be used as a means of saving money in the form of an account at a particular bank. It is expected that remote areas can still get services of banking facility through the concept of branchless banking without having to establish Bank oice infrastructures. On the credit distribution side, expansion of credit extension outreach shall be conducted through the concept of credit start-up and land certiication. Consumer protection is one of the advantages to be gained by public if they are associated with formal inancial institutions compared to if they get connected with informal inancial service providers, given that formal inancial service providers have regulator which implements governance and supervision including regulation on protection for their consumers. This thing is relected in the Sixth Pillar of consumer protection. For instance, for bank customers, BI has required banks to