Bank Mandiri Persero Tbk PT : Strengthens Digital Financial Services

Jakarta, 20 February 2015 - Bank Mandiri has strengthened its Digital Financial Services (also known as "officeless banking services") through Mandiri e-cash so as to improve access to banking services for all levels of society in Indonesia. Currently, the number of Mandiri e-cash digital financial services (DFS) users, including those who use Mandiri e-cash to receive state benefits, amounts to more than 1 million.

As the first bank to develop DFS in Indonesia, Bank Mandiri is also increasing the number of its DFS agents around the country so that the expansion of DFS, as promoted by Bank Indonesia (and the Financial Services Authority) can be expedited. Currently the number of Bank Mandiri DFS agents stands at 391. It is expected that this figure will have increased to 9,000 by the end of 2015.

According to Bank Mandiri Group CEO Budi G. Sadikin, higher Mandiri e-cash penetration will also help the public to manage their finances better and more efficiently so as to improve their financial circumstances in the future.

"The use of digital financial services will familiarize people with how to save and properly manage their money. It will certainly support the effort to improve the well-being of every citizen and to encourage economic growth in Indonesia," said Budi.

Based on data from the World Bank's Global Financial Inclusion Index 2012, only about 20% of Indonesia's population over the age of 15 enjoys access to financial services, as compared to other countries such as China and India, where the corresponding figures are 64% and 35%, respectively. The low level of access to financial services in Indonesia is reflected in the number of bank accounts per 1,000 adults, which has only just reached 505, while in Malaysia and Thailand the figures are 2,063 and 1,449, respectively. Lack of access is also reflected in the number of loans per 1,000 adults, which stands at 197 in Indonesia, while in Malaysia and Thailand the figures are 964 and 272, respectively. These figures show that there is still significant scope for improving the public's access to financial services in Indonesia.

The DFS concept involves a payment and financial services system that is operated in collaboration with third parties (agents) through mobile technology-based and web-based platforms. Such services help to support the development of a more inclusive financial-services sector and the more effective distribution of state assistance (G2P). The presence of DFS agents will help people who have never had contact with the banking system (or people who are known in banking parlance as the "unbanked segment").

DFS agents can serve basic financial transactions, such as the opening of electronic money accounts, handling cash deposits and withdrawals, and helping to educate the community about financial services. As for non-cash transactions, such as money transfers to mobile phone numbers or purchasing mobile phone or electricity credits, these can be done by accountholders via their mobile phones. Such transactions are relatively safe as they require the use of a PIN (Personal Identification Number).

To support this, Bank Mandiri has launched mandiri e-cash to facilitate micro payment transactions. This application can be accessed by customers through their mobile phones without the need to open an account at a Bank Mandiri branch.

Mandiri e-cash is a social-media based electronic money application that aims to encourage the creation of a cashless society. The application can be downloaded from Google Play, the App Store, Blackberry App World, Nokia Store, or by accessing *141*6#. It combines banking services with social media, and can be used by both Mandiri and non-Mandiri customers, with the user's mobile phone number also serving as the account number.