In the past decade, the Government of Indonesia has exerted significant efforts to increase access to formal financial services, particularly by encouraging branchless banking services for financial inclusion (Layanan Keuangan Tanpa Kantor Dalam Rangka Keuangan Inklusif/Laku Pandai). Branchless banking allows banks to penetrate remote and rural areas through their representative agents. However, despite the massive increase in the number of Laku Pandai (branchless banking) agents, the number of accounts opened per agent and the amount of savings put in the account per agent has not increased considerably (Graph 1 and 2). Furthermore, while 70.3% of adults have used a product or service from a formal financial institution, only around 55.7% of Indonesian adults are categorized as account holders in 2018, according to the Financial Inclusion Key Indicators issued by SNKI (Secretariat of National Strategy for Financial Inclusion).

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