Purwanti wini financial literacy msme-bi
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Transcript of Purwanti wini financial literacy msme-bi
Promoting Financial Literacy
for Micro-Entrepreneurs and SMEs
OECD/Thailand Seminar on Financial Inclusion
and Financial Literacy in Asia Bangkok, 16-17 December 2014
Financial Access and SME Development Department Bank Indonesia
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2
Outlines
1. Indonesia at Glance
2. Financial Inclusion in Indonesia
3. Financial Literacy: Bank Indonesia’s Programs
4. The Way Forward
INDONESIA AT GLANCE
Adults in Indonesia have account in formal financial institution
20%
DEMOGRAPHIC ±17.000 islands ±247 M population ±155 M adult people ± 28 M is poor people ± 44% lives in city
FINANCIAL INSTITUTION 120 commercial banks + 4.194 rural banks +187.598 cooperatives +600.000 MFI (incl. non-formal)
Source: World Bank, 2011 Global Financial Inclusion Index
Source : Bank Indonesia and Ministry of Finance, processed Source : National Statistic
Bureau-Indonesia, 2012
ACCESS TO FINANCE
3
Source: Ministry of Cooperatives and SME
SME’s ROLE IN INDONESIA’S ECONOMY
99.9% of 55 million
business units
absorb around 97,2% of total
labor force.
contribution around
57,48% to the GDP
Economic Conditions
FINANCIAL INCLUSION IN INDONESIA
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Save 48%
Don’t save 52%
74%
5% 3% 2%
5% 6%
5%
Saving only in Bank
Saving only in Non-BankFinancial Institution(NBFI)Saving only in Non-Financial Institution(NFI)Saving in Bank & NBFI
Saving in Bank & NFI
Saving in NBFI & NFI
Borrow 45%
Can’t Borrow
55%
23%
17%
30%
6%
11%
9% 4%
Borrow only from Bank
Borrow only from Non-Bank Financial Institution(NBFI)Borrow only from Non-Financial Institution (NFI)
Borrow from Bank &NBFI
Borrow from Bank & NFI
Borrow from NBFI & NFI
Source: Household Balance Sheet Survey-BI, 2011
S
A
V
I
N
G
B
O
R
R
O
W
I
N
G
Household Saving & Borrowing Behaviour
MSME’s Loan from Banks
7.926.250 9.462.228 10.662.581
39.440.522 38.974.819 39.934.395
9,5%
19,4% 17,8% 20,1%
24,3% 26,7%
0,0%
5,0%
10,0%
15,0%
20,0%
25,0%
30,0%
-
10.000.000
20.000.000
30.000.000
40.000.000
50.000.000
2012 2013 Sep 2014
MSME Loan Accounts Total Loan Accounts
MSME Loan Accounts Growth (% - yoy) MSMS Loan Account Share (%)
MSME Loan Accounts MSME Loan Outstanding
550,4 635,9 709,6
2.725,7
3.319,8 3.592,1
15,7% 15,5% 15,2%
20,2%
19,2% 19,8%
0,0%
5,0%
10,0%
15,0%
20,0%
25,0%
-
500,0
1.000,0
1.500,0
2.000,0
2.500,0
3.000,0
3.500,0
4.000,0
2012 2013 Sep 2014
MSME Loan Outstanding Total Loan Outstanding
MSME Loan Growth (% - yoy) MSME Loan Share (%)
Source: Banks’ monthy report-September 2014, BI
FINANCIAL INCLUSION IN INDONESIA
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THE NEED OF INCREASING FINANCIAL LITERACY FOR SMEs
Financial Education for SMEs
Financial education is a primary factor on demand side for formal savings, loans and insurance1.
Financial Literacy Survey (2009)2:
Society awareness on financial products and services is in line with education level, and society preference on financial products is highly affected by the promotion of the products over the safety guarantee of the savings.
Financial Literacy Survey (2012)3:
Financial literacy in Indonesia is highly influenced by gender, age, level of education (positive correlation), risk aversion (positive correlation), household income, distance from the house to the bank .
1) Cole S, Sampson T, dan Zia B. 2009. Prices or Knowledge? What Drives Demand for Financial Services in Emerging Market.
2) Bank Indonesia dan LD-FEUI. 2009. Tingkat Literasi dan Pemahaman Masyarakat terhadap Produk Keuangan dan Perbankan.
3) Bank Indonsia dan LD-FEUI. 2012. Financial Literacy Survey.
Source: Bank Indonesia survey, 2010
Survey result on impact of financial education for SMEs the SMEs become:
less likely to overcome delayed payment through banking payment
more likely to document their income and expenditure
more likely to plan expenditure and to separate business and household finance
more likely to have better financial management
Research Period : January 2011 – April 2013 Number of Respondents : 700 SMEs as borrowers of a Rural Bank, divided into 2
groups : Control and Treatment Group Number of Surveys : 1 Baseline survey followed by 2 Follow up surveys Type of Intervention : Training on Financial Education
Joint Research BI and ILO
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BANK INDONESIA’S PROGRAMS
Developing and Implementing Programs and Modules related to Financial Education
Framework of BI MSME Development
Increasing Access to
Finance
Minimize Asymmetric
Information
Strategy Coordination &
Strategic Partnership
Capacity Building
The Growth of MSME & Real Sector and Inflation Control Final Objective
Supporting food security and creation of new economic centers in the regions Short Term Objective
• Cluster Development
• Entrepreneurship
Development
• Financial transaction
recording movement
• Strengthening
Financial
Infrastructure
• Facilitation of
Government Credit
Program (KUR, KKPE,
KUPS)
• Provision of
study/research
• Dissemination of
Information
• Development of
MSME Microsite in
the website of Bank
Indonesia
Coordination with local government,
central government
and international
institutions
Research Training Provision of Facilitation Information
Programs
Methods
Cooperation with Ministries/Institutions/International
Organization
Financial Institutions,
Financial Product and Services
PART OF MSME DEVELOPMENT
PROGRAM
Financial Infrastucture
development and/or facility to promote financial access for
MSME (eg: SME credit rating, Government
Credit Programs)
COOPERATION WITH
STAKEHOLDERS
Financial Education &
Enterpreneur-ship for Migrant
Worker
Financial Education for
MSME & Entrepreneurs
Financial Transaction Recording
Progam
Training for Trainers
BANK INDONESIA’S PROGRAMS Implementation of Financial Education
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THE WAY FORWARD
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1. Integration of financial education with other SME development programs.
2. Widening the cooperation and coordination with related stakeholders to expand the target groups of financial education.
3. Focus of financial education on Training of Trainers (ToT) provide education directly to the community.
4. Replication of financial education program at national level to improve financial literacy increase financial capability and assist the effectiveness of financial inclusion.
Thank You 9