An accurate banking system can determine a customer or target that will receive the aid. Banks have trustworthy accountability systems since they do not want to incur losses
Jakarta (ANTARA) - Technology-based financial applications, or fintech, used by banks can help compile data on eligible recipients to boost social aid distribution, public policy observer from Gadjah Mada University (UGM), Agus Heruanto, has said.



"If the government utilizes fintech from banks, then they can not just use its delivery system," Heruanto told ANTARA here on Tuesday.



Social aid distribution faces two recurring problems involving the accuracy of data on recipients and social aid distribution procedures, he pointed out.



These problems are caused by the fact that the government has not yet recruited banks or other distributors to participate in processing social aid recipients' data, Heruanto opined.


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"An accurate banking system can determine a customer or target that will receive the aid. Banks have trustworthy accountability systems since they do not want to incur losses," he explained.



However, the government must first ensure that the fintech the banks use has the capability to select recipient data more accurately, he added.



In addition, agencies tasked with distributing the aid can also appoint other independent institutions to collect and select data, Heruanto said.


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"Of course, in this scenario, the banks will be tasked with collecting the data, while the selection and the delivery will be done through fintech. They are part of the same package, if we want to try a new system," he added.



Heruanto expressed the hope that the government's new breakthrough would be effective, especially since other government institutions find it relatively hard to intervene with the banking sector and fintech.



Social Affairs Minister Tri Rismahirini has announced that the government is developing an application for social aid disbursal in collaboration with Bank Indonesia, the Financial Services Authority (OJK), and fintech corporations. The application will be unveiled on August 17, 2021, she said.


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Translator: Sanya Susanti, Fadhli Ruhman
Editor: Fardah Assegaf
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