U.S. Department of State

With less than 50 percent of the Indonesian population having access to a formal bank, the World Bank estimates that mobile money could reach 74 million unbanked people in the country.

The USAID-funded Mobile Money Initiative, currently estimated at $4 million over three years, supports the Economic and Development Cooperation pillar of the U.S.-Indonesian Comprehensive Partnership. This Initiative directly supports the Indonesian government’s Financial Inclusion Strategy and advances the U.S. strategy to reduce poverty through economic growth.

The Mobile Money Initiative aims to extend mobile money to 10 percent of the unbanked market, or 7.4 million people, and will pursue partnerships with the private sector and donors to leverage additional resources. Working through a Mobile Money Technical Advisor and Mobile Money Implementation Unit, the Initiative will help the private sector, Indonesian government, and other donors ensure that local players build on their experience and find commercial footing to grow to scale.

The Mobile Money Technical Advisor will be embedded within the Vice President’s National Team for Accelerated Poverty Alleviation (TNP2K) to advance Indonesia’s mobile money agenda. To support the Indonesian government’s Financial Inclusion Strategy, the Advisor will work with the staff of TNP2K to provide guidance, technical assistance, and capacity building in areas including:

• Developing a strategy and action plan for implementing a pilot program for mobile conditional cash transfers.
• Coordinating policy across the relevant Ministries including Ministry of Communication and Information, Ministry of Social Affairs, Bank of Indonesia, PT Pos, and other relevant agencies.
• Advising and convening relevant parties from the public and private sectors and donor community.

The Mobile Money Implementation Unit will be a policy, research, and learning center that will provide financial and technical assistance to promising mobile money projects. The Unit will be run by an implementing partner to afford independence and flexibility, but engage closely with TNP2K to ensure local participation and ownership. Activities of the unit will include:

• Administering a technical assistance fund to support the initial deployment of mobile money activities rolled out by banks, telecoms, the government, and other donors.
• Facilitating regional learning and sharing among implementers, donors, and other actors.
• Coordinating and advising stakeholders across sectors around good practices related to regulation and consumer protection.