BRI goes to be ‘beyond banking’

Arif Gunawan S.

It’s a bank, but will be the first one in the world to operate a satellite. It’s the most profitable lender in Indonesia, and the first in the world which operates a ship visiting scattered islands with an ATM machine and a bank outlet aboard.

Bank Rakyat Indonesia (BRI) has pushed its banking-service innovation to its outer limit, leaving other banks in Indonesia—and even in the world—to observe how far a state-owned bank could be to reach their customer in the largest archipelagic country in the world.

Indonesia, whose 80 percent of the area are seas with 95,181 kilometer of coast line, is split into 17,500 islands. The most populated archipelagic country, with 250 million of people, is a big market for the state-owned bank.

BRI serves one-fifth of the population, or equals to 50 million people across 33 provinces in Indonesia. The bank is known for its biggest amount of operating ATM (automatic teller machine), which now stood at 21,000 machines.

In a bid to answer the geographical challenge, they keep innovating. BRI-novasi (an acronym for ‘BRI’ and ‘innovates’), has become a motto to express their ambition to go “beyond banking” in the last decade. And they did that.

They have innovated ‘kapal teras BRI’ (BRI terrace boat) to serve their clients in scattered islands of Indonesia, which currently deployed in Seribu Islands and more to follow to serve Maluku, and Riau island.

They also created ‘E-banking hybrid lounge’, a five minutes bank-account registration machine, which is now located in four malls in three cities of Indonesia (Jakarta, Solo, Balikpapan) to enable their future-clients to apply for BRI saving account with only e-KTP (electronic-based ID) required.

“Although we have been serving for 120 years, we don’t want to be recalled as the oldest [local] bank in Indonesia, but we want to be recalled as a fresh look bank. And innovation is the key for achieving that,” said BRI’s CEO Asmawi Syam to the press in London on Wednesday.

BRI indeed is the first local bank operating in Indonesia, dated back to 16 December 1895, or 11 years after Hong Kong based-HSBC opened its first bank in the country in 1884. The state-owned bank has now become the most profitable bank in Indonesia with Rp 18.4 trillion (US$ 1.3 billion) of net profit.

The innovation, Asmawi further said, is urgently needed as the digital world has been gaining a traction. Currently, a bank is not merely competing with other banks, but with non-banking entities such as digital payment platform developers.

According to him, a bank must evolve into a better financial service by enforcing the digital service in a bid to win that technology-based competition. There are at least three variables that BRI is building related to that, such as technology, infrastructure, and IT (information technology) center.

“Therefore, we’re building the $200 million satellite and will launch it in Guyana in Juni 2016. A San Francisco-based Space System Loral is the manufacture and a France-based Arianespace is the space-launching arranger,” BRI’s director of compliance Randi Anto added.

The satellite has 54 transponders, of which 50 of them will be used by BRI to serve its network system such as ATM in remoted areas, as well as another banking services which need a reliable network. The other four transponders will be handed over to the government for the state purposes.

World acknowledges
BRI’s expansion into more than the conventional banking sectors has grabbed the world’s attention, as it was awarded ‘Bank of the Year 2015 Indonesia’ by The Banker magazine--an English-language monthly international financial affairs magazine owned by The Financial Times Ltd, on Wednesday.

“BRI is trying to get the remote regions. That is something we really value at, not to mention the satellite which is the first time for that kind of thing to happen. For a country like Indonesia, which has so many islands, that’s something really strong for BRI,” said The Banker Award spokesperson Stefania Palma.

A commission of external judges, she said, had decided to choose BRI as the winner due to its innovation besides the good financial condition. “If you’re a big bank in a country, but you don’t have anything innovative, anything that is a bit different, then you don’t necessarily have to win. It’s not only the size.”

The annual awarding event that recognizes the leading financial institutions from around the world. Top 1000th Word Bank, published every July, is a highly anticipated and respectable publication as they are based on The Banker’s database.

It is the second time in a row for BRI to win the category after the 2014 award from The Banker. Asmawi believed that the award would resulted to the more banks to follow BRI’s innovation such as the satellite operating-unit, solar cell-based ATM machine, kapal teras BRI, and E-banking hybrid lounge.

“Hopefully, BRI will become the benchmark for the world’s banking industry, in accordance with my vision to make BRI to become ‘the most valuable lender’ in Indonesia by 2017,” Asmawi said.

By becoming the bank which serves more than financial banking, he expected BRI to provide a thorough micro-financing, as well as the commercial and corporate financing.  The bank’s value, is also expected to grow further not only benefiting the government and the shareholders, but also the stakeholders such as the employees and the clients.***