Visa Int'l forecasts Indonesia debit card boom<\/p>\n
Dow Jones, Jakarta<\/p>\n
Indonesian consumer enthusiasm for non-cash deals could help U.S.
\ncredit card company Visa International boost debit-card
\npenetration by double digits annually through 2009, a company
\nexecutive said.<\/p>\n
The number of Visa-branded debit cards in Indonesia almost
\ntripled year-on-year to 6,756,000 in 2004, and the volume of
\nretail sales facilitated by the cards rose 32 percent in the same
\nperiod, said James Murray, Visa's executive vice president for
\nSouth and Southeast Asia.<\/p>\n
\"I could see (debit) card numbers growing like that for the
\nnext three or four years without much trouble,\" Murray told Dow
\nJones on Wednesday.<\/p>\n
\"Before the (1997-98 Asian financial) crisis, the payment card
\nmarket was really driven as credit cards... (now) the real engine
\nis offering basic electronic payment services to people on the
\nstreet.\"<\/p>\n
Murray said that Visa, through its network of 17 member banks
\nincluding Bank Mandiri and Bank Central Asia, holds a 65 percent
\nshare of Indonesia's credit and debit card market.<\/p>\n
That puts Visa ahead of rivals Mastercard International and
\nAmerican Express Co.<\/p>\n
The driver of Indonesia's strong debit-card demand is a
\ncombination of recent economic revival and a vast untapped market
\nof consumers who still rely on cash for financial transactions.<\/p>\n
Indonesia's gross domestic product surged 6.35 percent
\nyear-on-year in first quarter, putting the economy on track for a
\nprojected 6.0 percent expansion for the year. That result would
\noutpace last year's 5.1 percent rise and place the official
\ntarget of 6.6 percent annual growth from 2004 to 2009 within
\nreach.<\/p>\n
Growth in Indonesia's currently relatively small number of
\nbank depositors -- 60 million in a country of 210 million people
\n- will also likely help deliver new Visa card clients, Murray
\nsaid.<\/p>\n
Visa statistics indicate that currently only 1.6 percent of
\nevery US$100 in consumer spending in Indonesia is done with a
\ndebit card, compared to around 8 percent in Thailand.<\/p>\n
Visa will expand its range of debit card services for
\nIndonesia's consumers to include an automatic mobile-phone charge
\npayment system and an automatic cash-transfer system between Visa
\ncard holders.<\/p>\n
The projections of booming debit card use contrast with what
\nMurray describes as the \"dismaying\" downturn in foreign tourist
\ncredit-card transactions in Indonesia after the massive Dec. 26
\nearthquake and tsunami that devastated the northwestern province
\nof Aceh.<\/p>\n
Murray said foreign tourist Visa credit-card use in Indonesia
\ndeclined 7 percent year-on-year from the beginning of January to
\nthe end of the week of May 8.<\/p>\n
That decline threatens an annual $500 million in such
\ntransactions in the country.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/visa-intl-forecasts-indonesia-debit-card-boom-1447893297",
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"sponsor": "Okusi Associates",
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