FinTech development Bank Indonesian vs Conventional

  FinTech development Bank Indonesian vs Conventional (Ardin Dolok Saribu, Nonni Sise Riani Manihuruk, Ayang Pratama)

  Students USU)

  (Doctoral's Preliminary

  Business Bank is actually a business that has not changed. Commercial banks have been around since the XV century. Spearheaded by DeMedici family in Florence / Fiorenza. And indeed since the days of DeMedici, The bank's business is almost unchanged. Used to wear stools - now wear counters. Equally counting money. FinTech in Indonesia could threaten the existence of this kind of conventional banks. Until the 1970s, even business banks in developed countries are often referred to as Business 3-6-9. Pay interest to customer 3%, Loans 6% ... then at 9 to go play golf ... business bank in the world so changed drastically after pegging the dollar to gold removed by Nixon in 1971. But in Indonesia have not changed. So, I have to say - when the bank in Indonesia does not change soon, will follow the fate of the dinosaurs. Be irrelevan or extinct. And the threat of

  Fintech.

  extinction or irrelevant to be stronger and faster along with the presence The development of computing and communication faster. Money transforms into electrical code. "Banks of arms (Conventional Bank) "is threatened. Just like evolution, banks that do not flex bell and unwilling to adapt will tergil as.

  FinTech Startups began to appear. Starting from Paypal, bank business in the payment and transfer start subverted. Payments and remittances are only part of the Banking business activities, but that is the entrance of the Fintech company. Just a step away Fintech went into lending business - then the circuit will tereplika all banking business. Banks in physical form and branch office buildings are expensive to maintain. Not to mention the cost of expansion. Because still unclear regulation, conventional banks can still breathe. But it's only for a while might argue is not a physical bank can be replaced with either an ATM to grab or deposited money?

  The problem was EXPENSIVE ATM procurement and maintenance costs. Also the opportunity cost of money is in it. One ATM machine requires a maintenance fee Rp 140.000.000,- until Rp 150.000.000,- per month in one location. Imagine the coordination. ATM operational expenses include rent, electricity, insurance, maintenance, charging,

  IKASI communes of data, taxes, advertising, an d other. And the bigger the bank, the bigger the gamble. You want to replace the hundreds of thousands of branches or ATM? Overnight? Yes expensive and inefficient. Gilanya, people often ngambil money at the ATM and then shop at the store where the afternoon store deposited money to the bank. In DBS referred to the example of China, where the cost per transaction payment Fintech only 0, 53 Yuan vs.

  26 Yuan in an ordinary bank. And in a country with low banking penetration - Digital Bank can be more powerful effect. Bank activities can be between smartphones. BPRs are now starting to suffocate KUR. With 9% interest rate - how much deposit interest does the BPR offer? How much margin?

  And what happened at the Fintech company was extraordinary. Alibaba via Alipay last week to process a transaction valued at $ 14, 3 billion a day. This shows Fintech has an outstanding scalability that is unchallenged by ordinary banking. Imagine the margin potential difference. In addition to a very large fund processing capabilities, proliferation was remarkable. Tencent in China used 500 million users. Just imagine how conventional bank infrastructure is needed to serve 500 million customers in one day? This is still the automation of digital banking operations. Not touched Blockchain and his friends. And if payments and transfers can scale that, why does not Fintech all offer insurance and wealth management? Upon this, the new Fintech is now only combing its surface potential.

  The history and meaning of Fintech Financial technology term could apply to any innovation in the way people transact,

do business. Since the internet revolution and the mobile internet revolution, however,

financial technology has grown explosive, and the meaning of fintech, originally termed as

the application of advanced computer technology to back office banks or trading companies,

now has a broader role in commercial finance. New ways in the financial sector continue to

emerge. It aims to provide improved services. Increased use of technology in the financial

industry (fintech) is believed to increase the reach of financial services. Fintech emergence

has created a way for all entities to have access to all the tools and financial services at an

affordable cost.

  Today, banking and financial technology in the 2000s has ended and transformed

into Fintech. Currently on Indonesia has scattered 135 Fintech startup companies that have

been registered in OJK. Fintech startup companies in Indonesia are regulated about Borrowing Money Services Information Technology.

  

Meaning Fintech will continue to evolve with advances in information technology.

Era Fintech will bring a possibility on things that we previously considered impossible. This

matter may be seen when a cooperative, engineering, or other body can more synergize with

the banking in to withdraw customer's balance for daily transactions.

  How the Government sees Fintech For Bank Indonesia, the presence of fintech actually has a positive effect on the macro

economy. They can reach people who can not be reached by banking. On the one hand, banks

can not reach the fintech market because it is hit by many regulations. That is what can not be

done by the conventional banks, it could be addressed by players fintech. Even so, as the

central bank regulators also have a responsibility to download gawasi. lest fintech industry

rapidly enlarged, there is no regulation that houses, including from a legal standpoint. Do not

also the fintech players exposed to the case of financial products bodong and no rules. People

also need trust to be able to enjoy fintech products.

  Before going any further, one of BI's steps in familiarizing itself with fintech is to classify them into four groups:

  1. C rowdfunding and peer to peer landing. If analogous to e-commerce, this first classification is marketplace. But here's a special financial marketplace, which brings together capitalists and investors.

  2. Market aggregator. Iwan cite as Cekaja.com, which has the ability to collect and collect financial data to be presented to the user. Such as someone wanting to make a credit card, simply input their personal financial data. Later the platform will match and show which credit card suits her, based on the data inputted.

  3. Risk and investment management. The concept is like a financial planner but in the form of digital. Users will be directed where the investment product that suits him according to preference given.

4. Field of payment, settlement and clearing. Fintech here moves in the field of payment such as e-wallet and payment getaway.

  Of the four areas, crowdfunding and peer to peer landing are included in the supervision

of the Financial Services Authority (OJK). While payment, settlement, and clearing are

included in the BI domain. The reason is if it has entered into pay-pay process, there is the

velocity of money, the central bank was the one responsible. While two more will enter the

realm of BI if there they are a payment system.

  Fintech Friend or Foe from Conventional Bank?

  Ofen growing fintech appear perceptions assume fintech as a threat to the banking system. The mushrooming of fintech does not mean it does not cause any worries for banks. They worry about the presence of fintech will shift their existence. Indeed the emergence of new industries often seem threatening, but fintech is not an opponent or a bank competitor. Precisely fintech is a friend for banks that can be used as a partner. With fintech, banks can maximize their function by embracing segments not covered by banks yet covered by fintech. Fintech and banks can co-exist in building Indonesia's economic growth.

  For banks that still apply the old business model, the presence of this fintech can actually be a threat to them. Therefore, the existence of fintech should be able to stimulate banks to update their business schemes to be more efficient and of course adjust to the needs of the more modern consumers. In this era, banks are required to raise standards in the eyes of consumers, would not attract attention and satisfy the needs of consumers who increasingly complex and modern including bank objectives in running its businesses? Therefore, banks need to innovate again for their products, and also to meet the needs of consumers who are more modern it is necessary for banks to involve the role of technology with a slick in the business they live.

  In the future, the fintech that can be said as a new industry should be able to build credibility to be trusted by the people of Indonesia. And masyarakatpun will await more evidence of synergy or collaboration between fintech and banking. Next, let's look at how much the public loyalty to the totality of fintech and banking that has been done.

  Conclusion 1.

  The presence of Technology and business has changed the business model and changed business processes around the world.

2. The entry of technology into the financial business whose term is called Financial

  Technology has changed the existing banking business model around the world 3. With the presence of Financial Technology hence increasing the level of financial literacy society in Indonesia which still low

  4. With the development of Financial Technology, the banking industry has also changed following the development of existing technology

  5. If the banks do not anticipate from the existing technological developments then the presence of Financial Technologies will be a threat from the banking industry

  6. On the other hand, Financial Technologies should be adopted into the banking business so that it will improve the business performance of the banking industry

  REFERENCE: DBS Insight, Fintech Disruption in Asia Pacific

  PERATURAN OTORITAS JASA KEUANGAN NOMOR 77 /POJK.01/2016 TENTANG LAYANAN PINJAM MEMINJAM UANG BERBASIS TEKNOLOGI INFORMAS

  PERATURAN BANK INDONESIA NOMOR 18/40/PBI/2016 TENTANG PENYELENGGARAAN PEMROSESAN TRANSAKSI PEMBAYARAN

  McKinsey & Company, Fintech Challenges and Opportunities Accenture, The Future of Fintech and Banking : Digitally disrupted or reimagined?

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