Branchless Banking Process In Rural Area:Price And Non-Price Barriers

Mangani, Ktut Silvanita and Heatubun, Adolf Bastian and Tambunan, Martua Eliakim (2021) Branchless Banking Process In Rural Area:Price And Non-Price Barriers. Journal of Public Administration and Governance, 11 (2). pp. 317-330. ISSN 2161 7104

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Branchless Banking is one of the programs of Indonesia's financial inclusion strategy. The programs' name is "Financial Service Without Office in the Framework of Inclusive Financial" which called “Laku Pandai.” This study aims to portrait the implementation of the Branchless Banking program concerning the obstacles that occurred to achieve program objectives. The research conducted using qualitative methods. The existence of Branchless Banking agents close to the community has fulfilled the program objective, to make an easy way for society to do financial transactions without having to go to the bank office. Therefore, the implementation of the Branchless Banking program met the criteria for eliminating non-price barriers in financial services in remote areas. However, delegation authority to the agent as an extension of the bank to provide limited financial services has encouraged agents to engage in moral hazard behaviors by charging the tariff that greater than the official rate set by the managing bank. It showed that the agent has taken the consumer surplus provided by the Branchless Banking technology. Although accepted by society since considerably cheaper than the fee to go to the nearest bank office, that condition becomes a price barrier for the future development of Branchless Banking.

Item Type: Article
Subjects: SOCIAL SCIENCES > Finance > Banking
Depositing User: Ms Mentari Simanjuntak
Date Deposited: 02 Mar 2021 07:42
Last Modified: 03 Jan 2022 03:45

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