Bearing fruit from a pioneering spirit in Indonesia

Commonwealth Bank’s record-breaking, account-opening time of just 10 minutes in Indonesia highlights its digitally-driven ambition to boost customer acquisition in a country where wealth management remains relatively untapped.

Commonwealth Bank’s growth goals in Indonesia are closely aligned with how it executes its digitisation agenda – to support its intention to commoditise wealth management through its collaboration with fintech.

Indeed, the organisation has a solid track record in innovation in the country.

A decade ago, in 2007, it came to market with the first e-mutual fund, allowing customers to purchase, as well as transact and redeem, their mutual funds through mobile and internet banking. 

Further, because of its activities in promoting Auto Invest, and the related feature that allows customers to transact regularly by debiting from their savings accounts and subscribing to their mutual funds account regularly, Ivan Jaya, head of wealth management and retail digital business, says the bank has won a lot of plaudits from customers.

The bank was also recently awarded by KSEI (Indonesian Central Securities Depository) the best-selling agent in Indonesia, successfully operating S-invest – a national platform from KSEI to process mutual funds, with the highest number of transactions and standard level.

At the same time, Commonwealth Bank still has a wide geographic presence across Indonesia compared with of its counterparts. For example, it has around 90 branches, whereas many other foreign players have anywhere between 10 and 20.

Cutting a digital path

A recent example of the bank’s innovative spirit is TYME Digital – believed to be the first digital onboarding banking platform in Indonesia that allows customers to open savings account in less than 10 minutes. 

“We know that to open an account in this country, the average time is around one or two hours, and a debit card takes another 24 hours to activate,” explains Jaya.

The Commonwealth Bank opening process is fully digital, meaning there is no need to queue up at branch office. The paperless process includes everything from registration, verification and ATM card reception, to activation of mobile banking and internet banking services.

After opening a savings account at Commonwealth Bank through TYME Digital, customers will then have access to the loans, mutual funds, insurance policies and mortgage offerings.

Essentially acting as a virtual bank branch, this helps to meet an important goal of the bank – to reach more and more customers, explains Jaya. 

“The pop-up branch is proof that we can combine fintech and banking activities,” he says predicting that there will be around 300 to 500 Commonwealth Bank pop-up branches in Indonesia in the next 12 months.

Driving faster wealth development

More broadly, such an initiative will also help spur growth in the wealth management sector and encourage greater numbers of regular investors, according to Ivan Kusuma, senior vice president and head of investment business for Commonwealth Bank in Indonesia.

Sharing the same vision as the OJK, to promote investment in mutual funds, Kusuma explains: “[The] Regular Investment Plan is the best entry point for mutual fund penetration, which is still low in Indonesia.”

“The system must be able to automatically debit a client’s account and then invest automatically into the customer’s preferred funds,” he adds.

The regulator has already relaxed some regulations, says Kusuma, to enable a discretionary-type portfolio offering.

This means clients can effectively invest in whatever they want from a defined range of investible assets. 

Yet this engagement will typically not involve the banks, at least not initially, as clients need to liaise directly with the fund manager.

A wider opportunity

Both Kusuma and Jaya believe there is huge potential for growth in wealth management in Indonesia.

For instance, they say that the net asset value for the country’s mutual funds industry stands at around USD27 billion, having grown around 20% over the past seven months.

And they are putting in motion their strategy for the next three years to tap this and achieve their other goals.

This comes down to being able to serve hundreds of thousands – or even millions – of customers via a commoditised wealth offering.

Going digital with its advisory service, the bank is the pioneer of the Digital Advisory Service, in which it offers interactive and consistent market updates through various digital media platforms.

At the same time, the bank also wants to fulfil its wealth management demand through advisory, giving customers the ability to receive information directly, akin to a ‘push’ notification on their mobile, and then be able to transact digitally.

We would like to hear any feedback or suggestions you have – either on this content, or on what you would like to see us produce going forward. Plus – we want to hear about your news and any interesting developments at your firm.
Please email