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Indonesia’s
archipelago, due to
unequal development
of infrastructure in
telecommunications,
transportation, and
public facilities
Payment cards are also
used as a status symbol
through which they can
earn privileges such as
executive lounges in
airports or special
access to certain
merchants during
promotional events.
Certain financial cards
have been associated
with a certain lifestyle
Young professionals,
with growing
disposable income, will
still be the most
attractive consumer
group for increasing
the customer base of
payment cards and m-
commerce.
ranked second in 2013.
The market is dominated
by commercial and retail
banks; independent
issuers hold smaller
shares, mainly by
providing pre-paid cards
and store cards.
Banks also became more
active in terms of offering
mobile banking solutions.
In February 2014, Al
Barid Bank, for example,
introduced a new mobile
banking service; this
application applies to old
and new generation
mobiles, and may be done
via 3G or SMS. This
product targets all
population groups, with
or without a bank
account.
Despite the increasing
frequency of credit card
usage, small businesses,
which account for a
substantial share of
transactions, are still
reluctant to embrace
credit card acceptance.
Independent traditional
retailers have been more
reluctant to accept
financial cards due to
several factors, including
the high rental fees for
POS devices, the time
between the actual time
the transaction takes
place and the time of
payment by the issuing
bank to the retailer, and
the commission charged
by the issuer to the
retailer.
affected the performance
of personal credit cards,
leading the category to
register slower growth.
In 2013 private banks led
financial cards in value
terms, as they invested in
developing and
advertising innovative
products to encourage
consumers to use their
credit and debit cards.
State-owned banks, on the
other hand, accounted for
a high percentage of debit
and ATM cards in
circulation, due to their
role in distributing
salaries to government
employees and pension
payments.
Over the forecast period
financial cards and
payments is expected to
continue to register strong
growth in the number of
cards in circulation as well
as in value terms.
Advances in technology,
such as financial cards
which use NFC and QR
code payment technology,
and the increased
advantages and privileges
offered by card issuers to
financial cardholders will
stimulate growth in the
market.
coupled with the rising
number of Western
expatriates familiar with
using internet retailing
in their home countries,
boosted online sales and
pushed the growth of
overall financial cards in
2014.
Premiumisation and the
launch of cards tailored
to affluent consumers
are on the rise. The
leading banks are
increasingly focusing on
launching products to
cater for this affluent
segment through the
offer of exclusive
rewards schemes and
high-value competitions,
with Mashreq Bank and
Emirates NBD strong in
these areas.