From Insights to Decisions: How Bank Partners Can Leverage CLIKBoard to Accelerate Credit Card Penetration

Credit card penetration in Indonesia has been stagnant and low, at just 5% compared to 35% in Thailand and 30% in Malaysia. In the last few years, the Indonesian Card Industry has been facing challenges to compete in a new payment and lending landscape, with product alternatives such as digital payments like QRIS, Online Lending (pinjol), and Buy-Now-Pay- Later (BNPL) filling a large lending gap and acting like a credit card. On the other hand, according to PT CRIF Lembaga Informasi Keuangan (CLIK) and the Indonesian Credit Card Association (AKKI) data, credit card ownership in Indonesia reached 14,4 million as of March 2024, growing by 8,3% year-over-year (YoY).

A report from Katadata stated that QRIS and BNPL reach their peak in 2024. QRIS transactions were used by 48 million users by March 2024, while the BNPL recorded 13,4 million active users as of December 2023. Regarding user age groups, QRIS and BNPL are more popular among Gen Z and Millennials, which are also the main target of credit card users for most commercial Banks.

Where does the credit card stand?

Though many people opt for new payment methods, credit cards use and receivables growth are sustained (8 – 15%), offering attractive value propositions to existing credit card customers. In terms of interest rate, PricewaterhouseCoopers (PwC) reported that online lending has an average annual rate of 108% compared to credit cards, with a legal maximum interest rate of 1.75% per month. Credit cards also offer benefits and rewards to their cardholders to enjoy and support their lifestyle, which is one of the strong attributes of a good credit card brand. However, this brand value has yet to help conventional credit card issuers attract new users.

According to CLIKBoard’s recent report, the credit card industry in Indonesia acquired only 250.000 new card customers per month. This number is significantly lower compared to a larger market like India, which reported acquisition levels of new credit card users reaching around three (3) million applicants per month.

PT CRIF Lembaga Informasi Keuangan (CLIK) realizes that competition has increased for consumer’s share of wallets due to changing consumer preferences and behavior. “The more digitally savvy a person is, the more options they have in choosing instruments for daily transactions, including when they need to get quick funds or to finance large purchases. BNPL and online lending offer solutions to this need, but in exchange for higher interest rates,” said Commercial Director CLIK Jan Tjintjelaar.

As payments and lending practices are rapidly changing, so are consumer behavior patterns. Conventional Banks and other Credit Card issuers must adapt quickly to changes and embrace competition. Hence, CLIK developed a product named CLIKBoard, and collaborated with AKKI to provide a solution to support holistic business growth among commercial credit card providers. With CLIKBoard, banks can obtain updated industry and market data, identify trends and opportunities, as well as make informed decisions to validate existing or create new acquisition strategies, develop targeted customer engagement campaigns, and monitor portfolio performance.

“CLIKBoard enables banks easy access to structured information of the whole credit card industry in Indonesia combined with comprehensive data analysis. The data obtained can be a valuable benchmark tool for banks to identify user trends and opportunities. The insights are expected to help increase the effectiveness of card acquisition programs and assist banks in monitoring and managing emerging risk patterns in their portfolios” added Jan Tjintjelaar.

CLIKBoard has a variety of features and schemes specifically designed to assist clients, including:

• Access to Accurate and Up-to-date Credit Data

CLIKBoard provides direct access to accurate and up-to-date credit data, including market trends, benchmark, and other credit industry performance and insights. This enables financial industries to monitor market conditions and make data driven decisions.

• In-depth Credit Market Analysis

CLIKBoard goes beyond providing data to offer in-depth credit market analysis. CLIK experts thoroughly and continuously process data into information and generate easy-to- understand reports to inform industry players on market trends and growth opportunities.

• Enhanced Operational Efficiency and Strategic Planning

The ease of access and information offered by CLIKBoard enables users to save time and make faster, more confident decisions. This improves operational efficiency and enhances strategic business planning.

“The creation of CLIKBoard is in line with the private credit bureau’s function of encouraging a safe and healthy credit card industry, especially with the depth of credit information that can be obtained from our data for banks to use. For users, we encourage the flexibility to choose from various financial services based on their specific needs. A balanced utilization of both credit cards and Buy Now Pay Later (BNPL) is essential for a healthy financial ecosystem in Indonesia,” Jan concludes.