MasterCard issues 2m debit cards

JAKARTA (JP): MasterCard International said yesterday it had issued its Maestro debit cards to about two million people in Indonesia since the company introduced the service four years ago.

The vice president of MasterCard's Debit Services in the Asia Pacific region, Jeff Portelli, said yesterday he was optimistic that the number would increase, as Indonesia, like other countries in the region, was one of the most rapidly developing markets for debit cards.

"The region as a whole has embraced debit products faster than any other country in the world, with 32 million Maestro cardholders in the Asia Pacific since it was launched in 1993," Portelli said.

He said the company expected the figure to rise to 100 million by 2000, with the level of awareness, and readiness to accept new technology in the region.

Portelli said most cardholders in Indonesia considered getting the cards for security purposes.

The debit card allows a transaction to take place at point-of- sale such as a store, with the funds taken straight from the card user's bank account.

Portelli said the debit cards are preferred by Indonesian users over credit cards for shopping and everyday purchases.

About 90 percent of the people surveyed by the company in the country said they wanted the card for traveling overseas, he said.

Portelli said there were about 5,000 merchants or points-of- sale in the country accepting the Maestro card.

He said 16 local banks including Bank Bali, Lippo Bank, Bank International Indonesia, and state-owned Bank Negara Indonesia had cooperated with his company to issue the Maestro cards and Cirrus, Mastercard's Automated Teller Machine network.

Although banks generated less revenue from debit cards than from credit cards they could gain great benefits including no risks and a higher average of balances of daily accounts, he said.

"Since people not only use the money when they are paying for something, more money would be left in the banks," he said.

He said the cost replacement of the banking service, or the cost to perform certain tasks during a transaction using a debit card would also be much lower for the bank, than during a transaction using the bank's teller service.

"In the near future, we will see that the local banking industry is heading more in the direction of remote banking," he said.

"There will be less new branches and more points of interaction where banking transactions can be made through personal computers, telephones, ATMs and merchants accepting the debit cards," he added. (das)