TEMPO.CO, Jakarta - The Financial Services Authority (OJK) targeted issuing regulations on digital banks before the end of the first semester of this year.
In general, the establishment of a digital bank will be divided into two groups; a new one with a minimum core capital of Rp10 trillion and conventional banks that are transforming into digital ones.
The Acting Deputy Director for Indonesian Banking Architecture, Tony, opined that the presence of digital banks will not necessarily threaten conventional banks as banks have various market segments, ranging from corporations, retail, MSMEs, to wealth management.
The market segment of digital banks is towards retail, he added. Besides, large banks have strengthened their digital technology.
He estimated that digital banks will not be able to take the corporate segment in the near future. “So, will neo-banks become a threat to [conventional] banks? Maybe there will be competition in the retail segment. But it is still far away for neo-banks or fintech to reach the corporate segment,” Tony explained.
He further mentioned that many small banks transforming into digital ones, including PT Bank Neo Commerce Tbk. (BBYB), PT Bank Jago Tbk. (ARTO), PT BCA Digital, and PT Bank Harda Internasional Tbk. (BBHI).
Other than the provision of core capital, Tony said the OJK was concerned about the business model offered by digital banks, digital technology owned by banks, IT risk management, corporate governance, and human resources in drafting the regulations.