No: 25/168/DKom
Digital infrastructure provided for the public plays a critical role as an enabler of financial products to increase financial inclusion. Digital public infrastructure (DPI) includes digital systems to identify user ID, digital payments process and financial transactions as well as exchange data/information. Optimal DPI helps overcome barriers to financial inclusion, such as geographical challenges and transaction costs, towards strong, inclusive and sustainable growth. DPI has changed the lives of millions of people through advanced financial inclusion. That was the key takeaway of the symposium, entitled “DPI for Advancing Financial Inclusion and Productivity Gains Towards Attaining Sustainable Development Goals", as a side event of the 3rd Global Partnership for Financial Inclusion (GPFI) meeting, which is a G20 Working Group (WG) focusing on global financial inclusion, under the auspices of India's G20 Presidency in 2023, held in Nusa Dua, Bali (24/06).
The Deputy Governor of Bank Indonesia (BI), Filianingsih Hendarta, took the opportunity to convey three important aspects of DPI. First, DPI provides a foundation for digital innovation, while enabling productivity gains to drive financial transformation and inclusive economic growth. Second, by optimising DPI, we can facilitate faster and more convenient financial services for all. Third, G20 member countries must develop financial literacy for their citizens, while strengthening consumer protection, including the protection of personal data, as well as the regulation and oversight of digital transactions. “Let us realise the vision of a strong digital financial ecosystem to expand financial inclusion together. We appreciate the discussion on DPI as well as the outcomes achieved by the GPFI under India's Presidency," added Deputy Governor Filianingsih.
In Indonesia, the payment system is a critical element of providing DPI. Digital payments are a DPI practice fully supported by Bank Indonesia in at least three key areas. First, in the digitalisation of the social assistance programs. Second, in the electrification of regional government financial transactions. And third, in the area of transportation through omnichannel digital payment mechanisms, as implemented in the Jabodetabek national transportation integration project. Accelerating DPI implementation is supported by strong digitalisation potential in Indonesia, such as 74% internet penetration, 98% of merchants adapting to digital payment methods, as well as rapid FinTech and e-commerce development to provide diverse payment solutions.
At the symposium, the Chief General Manager-in-Charge of the Reserve Bank of India (RBI), Sonali Sen Gupta, expressed appreciation for Indonesia's enthusiasm to host the GPFI and side events relating to digital public infrastructure. According to Sonali, financial inclusion has the potential to unlock various opportunities for all elements of society to be absorbed into the formal sector. GPFI targets universal financial inclusion by prioritising the collective vision of all leaders towards an equitable future. One of the UN SDGs is to leverage financial inclusion as a key factor of achieving sustainable development worldwide. To that end, the two previous meetings explored DPI use cases in terms of digital payment innovation to bolster economic resilience.
Under India's G20 Presidency in 2023, GPFI has identified priority DPIs to enable financial inclusion and productivity gains. The working group will provide policy recommendations to optimise DPI implementation. At the symposium, experts and G20 delegates shared various recipes and success stories concerning DPI implementation in their home countries. For example, e-KTP, BI-FAST and QRIS in Indonesia, PIX instant payments in Brazil and UPI in India. Speakers at the symposium included the Deputy Governor of Banco Central do Brasil, Mauricio Moura, Co-Lead of the Digital Public Good Alliance, Liv Marte Nordhaug, UNDP Chief Digital Office, Keyzom Ngodup Massaly, Senior Advisor of Saudi Central Bank, Haitham Al Ghulaiga, GPFI Lead, Ozlem Oktay, as well as Co-Founder of Sahamati, Siddhart Shetty, with Chanchal Chand Sarkar, Economic Advisor from the India Ministry of Finance, serving as moderator.
The symposium is expected to increase awareness concerning the importance of DPI as a critical public facility to advance digital financial inclusion and increase understanding of the aspects that must be considered, including the prerequisites for developing DPI. Support from experienced practitioners and various countries will complement the understanding to overcome the implementation challenges. This is an important side event on the road to the GPFI meeting being held on 25-26th June 2023 in Nusa Dua, Bali. As an ally of India to help advance financial inclusion at home, Indonesia welcomed hosting this event of India's G20 Presidency, which also featured an exhibition of MSME products showcasing, snacks, textiles and weaving.
Jakarta, 24th June 2023
Communication Department
Erwin Haryono
Executive Director
Information about Bank Indonesia
Tel. 021-131, Email: bicara@bi.go.id
