MasterCard sees business in RI growing at 'fantastic rate'

Fitri Wulandari, The Jakarta Post, Jakarta

International payment card company MasterCard International is optimistic that its business volume here will continue to grow at a "fantastic rate" despite the country's current economic difficulties, according to company senior vice president and general manager for Southeast Asia, Ajay Bhalla.

He told The Jakarta Post this week that last year the company's payment card business here grew by 42 percent, with the gross dollar volume reaching US$531 million.

He expected a similar growth rate for this year.

Bhalla said that the payment card industry in Indonesia had huge room for growth because there were still only a few people using payment cards for their daily transactions.

For instance, based on data from the Indonesian Credit Card Association (AKKI), in 2000 credit card holders only made up 0.5 percent of the population.

With the low number of payment card holders, Indonesia is an open market for the company, whose line products include credit cards, the Maestro debit card, and the Cirrus ATM card.

Bhalla said that the biggest challenge for the company in Indonesia was educating consumers to shift from cash to card payments.

"I think (the) biggest challenge in Indonesia for us, more than new products, is to propagate the convenience of payment cards ... the consumers need to be educated," he explained.

He said that MasterCard's long-term goal in Indonesia was to persuade as many banking customers as possible to have MasterCard payment cards.

There are around 48 million banking customers in the country.

Bhalla said that last year, the number of MasterCard credit card holders reached 1.5 million, while the figure for the Maestro debit card was 9.15 million.

In 1999, the number of Maestro debit card holders was 7.9 million, up from 4.5 million in 1998.

Regarding the strategies for expanding the payment card business in Indonesia, Bhalla said they were basically the same as MasterCard's global strategies.

"Basically, we will focus on strengthening the services and products as well as trying to differentiate ourselves by issuing customized products," he said.

To expand its business, MasterCard has tied up with local private and state-owned banks.

MasterCard International recorded more than 11.6 billion transactions worldwide last year with a gross dollar volume of $986 billion, an increase of 17.6 percent over 2000.

Its 15,000 member financial institutions worldwide issued 520 million MasterCard branded cards, which is an 18.8 increase over 2000, the highest year-to-year growth rate in five years.

In Asia, MasterCard reported a gross dollar volume of $200 billion, up 18.2 percent from the previous year.