Association Believes Credit Card Transactions Will Continue To Grow This Year

Illustration. (Angga Nugraha / VOI)

JAKARTA - The Indonesian Credit Card Association (AKKI) expressed optimism regarding credit card transactions that will still have good prospects until the end of this year. The condition of loosening Large-Scale Social Restrictions (PSBB) and starting to enter into a new normal state according to AKKI, will in fact be a factor in increasing credit card transactions.

AKKI is optimistic that transactions will still grow even though from April to June 2020 there has been a very significant decline. This is because people cannot leave their homes and shopping centers are not operating.

"This situation (the reduction in transactions) will not be permanent. With the opening of the PSBB and entering the new normal, the public will return to their normal activities so that transactions will be normal as well. We are still very optimistic that the transaction will grow and we are making preparations for it," said the Executive Director. Indonesian Credit Card Association (AKKI), Steve Marta during a press conference for a virtual PIN mandatory campaign, Tuesday 23 June.

Steve said, credit card transactions as a whole from the beginning of the year to June had indeed decreased. According to him, this was due to the decline that occurred in the last three months since the determination of the COVID-19 pandemic.

However, during the first quarter of 2020, it still increased by 7 to 8 percent. He explained that the decline that occurred during the four months starting from April was very significant.

This is due to the government's PSBB policy to prevent the spread of COVID-19 which has closed shopping centers. In addition, there are no trips outside the city, so transportation ticket purchases and hotel transactions have decreased.

However, he said, restrictions on activities outside the home were actually able to encourage credit card transactions for online shopping in e-commerce. The pandemic has led to a shift in shopping from shop to online shopping.

According to him, online shopping for groceries, medicines, electronic devices, and home decorating equipment has increased significantly. However, shopping via e-commerce cannot keep up with the decline in transactions in the travel needs sector.

This is because, said Steve, hotel transactions and ticket purchases have so far had a larger volume than e-commerce transactions. He hopes that in the next quarter, transactions will increase considering that when the PSBB transitions to a new normal phase, transactions in shopping centers will run normally again.

The importance of a PIN

He also reminded the importance of maintaining credit card security using a Personal Identification Number (PIN). In accordance with Bank Indonesia regulations, credit card transactions can no longer use signatures starting July 1, 2020.

Starting July 1, 2020, all Mandiri credit card transactions at merchants are required to use a PIN. Don't have a credit card PIN? Come see the following video. Info https://t.co/axVg2gzCaQ pic.twitter.com/CSzqSnkv9x

- Mandiri credit card (@mandiricard) June 21, 2020

In accordance with BI's mandate, credit card holders in Indonesia must use a six-digit PIN when making credit card payments. However, credit cards with contactless technology can still be used for shopping without the need for PIN authentication if the nominal transaction is below IDR 1 million.

Based on a survey conducted in June by AKKI to estimate the level of concern of credit card users with the regulation, more than 81 percent of credit card holders know the deadline for compulsory PIN.

According to Steve, the survey results show that the initiatives from various stakeholders have successfully fulfilled their goal of raising awareness of credit card holders in Indonesia regarding the July 1 2020 deadline.