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2018 Annual Report PT Bank Central Asia Tbk 107 In this digitalization era, BCA’s transaction banking has
expanded its collaboration with strategic partners - public service institutions, financial technology (fintech) companies, and e-commerce business - in developing its cashless society ecosystem. In expanding this ecosystem, we leverage on the latest technology, such as the Application Program Interface (API), to facilitate connectivity between various payment systems, and to enhance customer experience.
With support from our core transaction banking business, customer trust and the provision of a comprehensive financial solution, Current Accounts and Savings Accounts (CASA) grew 8.9% to Rp483.0 trillion from Rp443.7 trillion the previous year. As of December 2018, CASA was the main contributor at 76.7% of total third party funds.
Excellent Products and Services
BCA has widely used transaction banking products and services, such as debit cards, credit cards, electronic money, and various payment features based on internet banking, mobile banking and collaboration platforms with strategic merchants. The debit and ATM cards are connected to customer savings accounts and can be easily accessed via internet and mobile banking facilities.
We developed various savings products to cater to the diverse and dynamic customer needs, both in the organization and individual segment. For the individual segment, Tahapan BCA remains the top product with the most significant contribution in third party funds.
Tahapan is developed in accordance with customer needs, such as the Tahapan Xpresi that is aligned with a more expressive youth lifestyle and comes with various promotions and unique ATM card designs. BCA also has the Tapres product for the customer who seeks a savings account with a higher interest rate.
&ORBUSINESSNEEDS"#!HASTHE4AHAPAN'OLDPRODUCT that provides complete and detailed transaction information for an easier business operation process.
BCA also offers current accounts for business customers available in 9 currencies. The current account customer will get cheque payment facilities, as well as electronic banking services including internet and mobile banking.
These facilities are offered to fulfill payment needs of business customers. BCA also provides a notification feature for every transaction the current account customer does via SMS (short message service) and email, which makes it easy for customers to track their business transactions.
Transaction banking is the main driver of the growth of Current Accounts and Savings Accounts (CASA).
We continue to proactively innovate new transaction
banking products and services in line with customer
needs and the development of digital technology.
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To support customers who want to fulfill their long term plans, BCA offers Tahapan Berjangka (Tahaka), with a monthly routine deposit mechanism. This comes with BCA Life insurance protection. The opening of a Tahaka account can be done via branch office, video facility at MyBCA, and internet banking. In 2018, BCA provided Tahaka SiMuda, initiated by the Financial Services
!UTHORITY/*+ TOENCOURAGETHEYOUNGGENERATIONTO routinely save with lower monthly deposits than Tahaka.
BCA collaborated with MasterCard to launch a debit co-branding card, which can be used for transactions in all MasterCard ATMs and merchants all over the world, and is aligned with the National Standard Indonesian Chip Card Specification (NSICCS). BCA also actively participated in supporting government policies REGARDING THE .ATIONAL 0AYMENT 'ATEWAY .0' BY encouraging customers to exchange their debit card for ONEWITHTHE.0'LOGO
To facilitate customer transaction needs for cashless payment, we continue to expand debit and credit card acceptance with a widespread EDC network placed at strategic merchants throughout Indonesia. To expand the scope of debit card utilization internationally, we worked with MasterCard, Maestro, and Cirrus international networks; and for credit card acquiring services, we cooperate with international networks such as Visa, MasterCard, American Express, JCB, NETS, and China UnionPay International (UPI).
For credit card issuance, BCA cooperated with various international networks, such as Visa, MasterCard and American Express. To capture new opportunities from society’s growing lifestyles in regard to overseas travel, in 2018 BCA launched the BCA Singapore Airlines +RIS&LYER )NlNITE CREDIT CARDS THE THIRD COBRANDING products with Singapore Airlines. This card gives the BENElTOFFASTERACCUMULATIONOF+RIS&LYERMILESFOREACH
2018 Annual Report PT Bank Central Asia Tbk 109 transaction, and a monthly spending bonus according
to transaction accumulations. BCA also developed other co-branding cards through a strategic alliance with company partners, such as Matahari Department Store and Indomaret. Not only does BCA affiliate with international credit card networks, it is also the only bank in Indonesia with a private label credit card, or proprietary card - BCA Card - which can be used in Indonesia and several outlets in Singapore.
To reach a broader customer base and to strengthen customer loyalty, BCA has a number of promotional partnership programs for customers that use various transaction banking products and services throughout different segments, such as discounts or the use of 2EWARD "#! FOR OFmINE MERCHANTS AS WELL AS INSTALLMENTS FOR BOTH ONLINE AND OFmINE MERCHANTS Collaborations with strategic partners are made in order to strengthen the transaction banking product value proposition according to their target market, for instance, partnerships with Starbucks, McDonald’s,
#INEMA88)#'6AND3INGAPORE!IRLINES"#!ALSOHAS promotional partnership programs with e-commerce partners including Tokopedia, Blibli.com, Tiket.com, Lazada and with other e-commerce companies in various programs, such as BCA 12.12 online shopping day, and regular programs such as Monday e-promotion.
To strengthen EDC BCA customer loyalty, the Bank held the lucky draw for merchants that use EDC BCA, in order to push the acceptance of BCA products.
Credit Card Outstanding
(in billion Rupiah)
12,893 11,528
2018 2017
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In addition to debit and credit cards, we also offer the e-money Flazz card, which is mostly used to facilitate small value payments that require speed. Flazz is very practical for use for payments in the mass public transport sector, including toll roads, commuter lines, Transjakarta buses, parking facilities and transactions at convenience markets, fast food and beverage outlets.
Integrated Multi-Channel Network
To support the use of products and services for business and the individual customer, we consistently develop an integrated multi-channel network. BCA’s integrated multi-channel network is a synergy of the physical network of the branch offices with various digital networks, to facilitate easy access to transaction banking services at all times. In 2018, we served over 19 million customers through 1,249 branches, 17,778 ATMs
and hundreds of thousands EDCs, as well as internet and mobile banking networks. The average number of transactions grew to over 17 million per day in 2018, from 14 million in 2017.
Development in digital network continues as customer transaction preferences shift to the digital channels, with 98% of BCA’s transactions in 2018 conducted through internet banking, mobile banking and Automatic Teller Machine (ATM) services. The increase in digital transaction preference is in line with BCA’s efficiency in transaction operations. The growth of digital transactions is supported by the increase in internet and mobile banking use. The addition of new service features on digital channels continued in 2018, so the customer can have a convenient and easy experience in transaction banking.
Number of Distribution Channels (unit)
2018 2017
Number of Branches (including cash offices) 1,249 1,235
Number of ATMs 17,778 17,658
Delivery Channels Transactions
2018 2017 )NCREASEDECREASE
Total Composition Total Composition Total Percentage Branch
Number of Transactions (in million) 156 2.4% 160 3.0% (4) -2.5%
Transaction Value (in trillion Rupiah) 14,866 53.8% 14,131 56.6% 735 5.2%
ATM
Number of Transactions (in million) 2,030 31.8% 1,911 36.3% 119 6.2%
Transaction Value (in trillion Rupiah) 2,303 8.3% 2,178 8.7% 125 5.7%
Mobile Banking
Number of Transactions (in million) 1,932 30.3% 1,161 22.0% 771 66.4%
Transaction Value (in trillion Rupiah) 1,389 5.0% 970 3.9% 419 43.2%
Internet Banking
Number of Transactions (in million) 2,264 35.5% 2,040 38.7% 224 11.0%
Transaction Value (in trillion Rupiah) 9,107 32.9% 7,694 30.8% 1,413 18.4%
Total
Number of Transactions (in million) 6,382 100.0% 5,272 100.0% 1,110 21.1%
Transaction Value (in trillion Rupiah) 27,665 100.0% 24,973 100.0% 2,692 10.8%
2018 Annual Report PT Bank Central Asia Tbk 111 The branch network has a role in handling large
amount cash transactions, considering that 54% of BCA transactions value were handled by branch offices. The branch network still plays an essential role in building customer relationships, as well as providing financial solutions through direct interaction in banking product and service education. BCA continues to invest in branch office human resources through development programs and continuous training. The expansion of BCA’s branch network is focused on trade area, commercial and residential with rapid development along with local economic development and infrastructure growth.
We pay great attention to the customer experience so they can get the best service from branches or other channels. Thus, we always do considerable investment in expanding branch offices. In 2018, we opened 14 new branches and 19 BCA Express, a temporary branch equipped with electronic services and managed by an OFlCER 7E PROVIDE SPECIAL BRANCH SERVICES FOR AFmUENT and high net-worth individual customers (Solitaire and Prioritas) and the BCABIZZ service for small and medium- sized enterprises, and the Weekend Banking service available for customers during the weekend.
The expansion of the Bank’s ATM network is focused on investment in Cash Recycling Machines (CRM), which facilitate both cash withdrawals and cash deposits, improving operational efficiency and reducing cash handling costs. In 2018, we continued to convert our conventional ATMs into CRMs. By the end of December 2018, the number of CRM ATMs grew to 5,595 units and contributed to 31.5% of the total amount of BCA’s ATMs.
Since 2014, we have developed MyBCA, a digital banking service booth located in strategic shopping centers that comes with various digital media that can be used independently (self-service), as well as developing a hybrid office - a combination of conventional office with MyBCA. In total, we operated 11 MyBCA and hybrid offices by the end of December 2018.
Adapting to the Digital Era and Endless Innovation The advancement of digital technology has risen to demand for a variety of transaction banking services, with ease of use and convenience. We have captured this opportunity and use digital technology to develop various initiatives in transaction banking services.
We continue to develop our internet banking service
@+LIK"#! MOBILE BANKING @M"#! AND SERVERBASED electronic wallets ‘Sakuku’ through the development of various features in these online channels. The cardless cash withdrawal service is now available through a one-time password facility in m-BCA. Through m-BCA, customers can also submit applications to raise credit card limits and block cards without having to visit the branch office or contact the call center. With internet banking, BCA has provided an e-statement facility - a type of electronic checking account.
BCA never ceases to innovate for customer satisfaction.
In 2018, BCA launched a transfer feature using the Quick Response (QR) code between BCA customers through the m-BCA and Sakuku applications. This product was introduced as ‘QRku’ and, in the future, its function will be expanded as a shopping payment system with various merchants.
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Along with the increase of e-commerce transactions, in recent years we have strengthened our online payment capability and built a cashless society ecosystem through partnerships with various merchants, including e-commerce and fintech partners. BCA is one of the first banks to use the Application Programming Interface (API) to build connectivity with e-commerce and fintech companies payment systems. The transfer payment method via virtual accounts, payments via BCA credit CARDS AND THE @+LIK0AY PAYMENT FACILITY EMBEDDED IN merchant websites have supported the e-commerce transaction needs of customers.
)N WE LAUNCHED THE /NE+LIK SERVICE A PAYMENT feature in online merchants that focuses on transaction speed by simplifying the payment steps that are integrated into the online merchant application. We will continue to build partnership and collaboration with rapid growing e-commerce and fintech.
We have also launched the Virtual Assistant (VIRA) chat banking service. VIRA is a chat-based banking service that can be accessed by the user via smartphone. With VIRA, the customer can seek information regarding BCA products and services, the latest promotions and access to banking services, such as balance inquiry, account transaction details, and credit card registration and information. We continue to develop VIRA, which is available in popular chatting applications by using chatbot technology and machine learning.
Education programs play an important role for customer acceptance of digital service innovation. Using various media, including digital and social media, BCA markets its digital services to introduce the ease of the aforementioned services. HaloBCA call center plays an important role in helping customers to use BCA services, as well as receiving customer suggestions and complaints.
HaloBCA also facilitates long-distance one-on-one with customers via video call at the MyBCA counter. Besides telephone and video calls, HaloBCA can also be accessed via chat on the BCA website.
We always provide the latest banking products and solutions for our customers from different generations.
Thus, we continue to innovate and give ease, convenience and benefit to our customers.
Looking Ahead
Transaction banking has the potential to grow further given the low penetration of banking products in the mass segment and high prospect of growth in the upper MASSAFmUENTANDHIGHNETWORTHINDIVIDUALSEGMENTS
In line with the rapid advances in digital and information technology and the evolution of consumer behavior, we remain committed to innovating transaction banking products and services. The use of digital technology will support product development initiatives as well as the provision of secure, convenient and reliable transaction banking services, which are easily accessed from various customer touch points as well as creating a product value proposition and transaction banking services that are stronger and relevant in this digital era.
2018 Annual Report PT Bank Central Asia Tbk 113 In the future, we will continue to develop a less cash
society through cooperation and collaboration with both private institutions and the government, to provide a payment system solution for various communities. This will be supported by numerous promotional, marketing and sustainable education programs, so BCA will always be one of the community’s main preferences for all banking services and solutions.
'UIDED BY ITS COMMITMENT TO BE !LWAYS BY 9OUR 3IDE BCA continues to adapt to changing customer behavior and developing technology. We always strengthen our branding and customer experience by using the personal touch to increase customer loyalty. We expect CASA will grow accordingly with the sustainable growth of the BCA transaction banking franchise.
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