Indonesian bank, Bank Central Asia (IDX:BBCA) says it is initiating a local credit card network that it plans to start operating early next year. BBCA CEO Jahja Setiaatmadja said that the company will be working with other banks yet to be named to roll out the new network.
BBCA already runs the BCA Card that can be used only within its network. It is already widely accepted within Indonesia, but has very limited use outside the country. The new network, since it will involve other banks, will not be branded BBCA. The company has not indicated what the brand name will be.
BCA’s rival Bank Mandiri (IDX:BMRI) has also stated that it is similarly planning to start a local processing network. BMRI’s CEO Budi Gunadi Sadikin has indicated that it is exploring the possibility of working with other banks to start such network.
Indonesia’s credit card market is worth about Rp180 trillion annually (approx. US$16 bio). According to Bank Indonesia’s Deputy Governor Ronald Waas, 90% of the transactions do not involve any foreign party, so it makes sense to operate a local payment network.