President Joko Widodo’s statement that he prefers credit cards used by the government to be issued by domestic issuers rather than foreign companies has been met with positivity from Indonesia’s credit card issuers.
Executive Director of the Indonesian Credit Card Association (AKKI), Steve Marta said that the government should encourage the use of government credit cards that utilise local issuers and public credit cards.
“It’s not only government credit cards but I think we should also have local credit cards one day,” Marta told CNBC Indonesia on Thursday, 6th March 2023.
Marta stated that the banking sector’s credit card issuers would also endorse this measure, citing security risks associated with credit cards issued overseas, as highlighted by Jokowi’s comments about US sanctions against Russia during the Ukraine conflict.
“I don’t think all credit card users will disagree if domestic credit cards are launched,” said Marta.
Credit card issuance is a market mechanism. This means that if local credit cards are pushed by the government, then become unable to compete with international credit card issuers, it is not impossible that the public will bear many risks.
For example, from a data security point of view, the burden of interest costs can be higher if no one uses it. Therefore, Marta suggested that domestic credit card services must continue to be developed to keep up with the times.
Bank Negara Indonesia (BNI) also fully supports this plan and is making preparations. This is because the development of credit cards that use the National Payment Gateway (GPN) as an alternative to Visa and Mastercard, is said to be able to strengthen the national payment system.
“Currently we have made various preparations regarding this, both in terms of infrastructure readiness and cooperation mechanisms with switching institutions, as well as ASPI (Indonesian Payment System Association) and PTEN (Completion of National Electronic Transactions) as organisers of National Electronic Transactions, which were previously carried out by international principals,” said the IT Director. and Operation BNI Toto Prasetio to CNBC Indonesia on Wednesday, 15th March.
Prasetio said that the GPN BNI credit card was expected to be issued in the first quarter of 2023. The initial stage of issuing this GPN credit card will be used within central and regional governments through the Domestic Government Credit Card (KKP) product.
The KKP is a payment method that can be used to make payments for expenditures that can be charged to the state budget, where the payment obligations of cardholders are met in advance by the government credit card issuing bank. L\the KKP will be issued by three major banks, namely BRI, BNI and Bank Mandiri. This KKP can later be used by 20 million merchants domestically and abroad.