Rio de Janeiro – 8 December 2016

INVESTOR EDUCATION

INITIATIVES IN INDONESIA Delivered at Behavioural Sciences and Investor Education Conference

Presented by

Kusumaningtuti S. Soetiono

Member of the Board of Commissioners

in Financial Education and Consumer Protection, IFSA

National Strategy: Financial Education Programmes

Financial Literacy Programmes

Investor Education Programmes

2

Implementation

Collaboration

Financial Inclusion Programmes

National Strategy On

Financial Literacy

Launched by the President on Nov, 19, 2013

1. Education and Financial

Literacy National

Campaign.

2. Strengthening

Infrastructure Financial

Literacy.

3. Product Development and

Financial Services

National Strategy On

Financial Inclusion

Launched by the President on Nov, 18, 2016 (revised version) National Strategy

On Financial Inclusion

(NSFI)

on the First Pillar

FINANCIAL EDUCATION

National Strategy

Focus: Increasing knowledge and awareness of the formal financial institutions, financial products and services, including features, benefits and risks, costs, rights and obligations, as well as to improve people's skills in financial planning and management

4

Implementation

Collaboration

Financial Inclusion Programmes

National Strategy: Financial Education Programmes

Financial Literacy Programmes Investor Education Programmes

5

132.7 Mio internet users (51.8%)

• 21,84%

Literacy Index

• 59,74%

Inlusion Index

Literacy & Inclusion Index

National Financial Literacy Survey, 2013

Background

Financial

Literacy

Index

Banking Insurance Pawnshop Financing PensionFu

nd

Capital

Market

21,80%

57,28%

11,81%

5,04 % 6,33 % 1,53 %

0,11 %

17,84% 14,85% 9,80% 7,13%

3,79%

Financial

Inclusion

Index

Source : Association of Indonesia Internet Providers

(2016)

6

Indonesia’s

Potential

Market

Remarkable growth In long

Term investment

• JCI growth In last 10 year: ±350% (15% p.a), the Highest Among major World indices (excluding dividend).

• MSCI Indonesia Return has outperformed MSCI World, Emerging Market, BRIC, and ASEAN.

• The capital market index ytd (up to 30 Nov 2016 grow by 13.19%, outperfomed South Korea, Malaysia, Singapore, HK, China

A huge potential number of

Listed Issuers

• + 140,000 ltd/inc Getting loan from bank

• 100 State owned holding, 600 Subsidiaries

• + 650.000 SMEs

A huge potential number of

Investors

• Currently, the number of investors are relatively low

less than 1 % population ( + 500.000)

• 97% of investors are local, however the value of stock

ownership is only 36% compared to non-resident of

64%

Indonesia’s Potential Market - Overview

+ 74 % of total listed companies

reported profits in FY 2015

Despite the global economic slowdown

7

Educational

Book Series:

Elementary, Junior and Senior High School

INVESTOR EDUCATION PROGRAMMES

Financial Education in Schools

Ministries Academicians and Schools Teachers

Financial Industry Association and

Financial Institutions

For pedagocial and Financial Theory

For Financial practices: - Banking - Capital Market - Insurance - Finance Companies - Pension Fund - Pawnshop

OJK develop Financial Education Materials collaborate with several institutions (Financial Education Task Force), for Senior High School, Junior High School, Elementary School and University

8

Educational

Book Series

for University

INVESTOR EDUCATION PROGRAMMES

Launched at Aug, 23

2016

Trial on 24

Universities

Economic Students

5. Finance Companies

6. Pension Fund

7. Other FI

8. Syariah Finance

9. Financial Planning

The Series:

Univesity

1. IFSA

2. Banking

3. Capital Market

4. Insurance

9

INVESTOR EDUCATION PROGRAMMES

School Capital Market

Schools Capital Markets (SCM) and the School of Islamic Capital

Market (SPMS) is a program of education and socialization of

capital markets organized regularly by the Indonesian Stock

Exchange (BEI).

SCM Level 1 and Level 2

Trial On 9 University

Has been Implemented Curiculum

of Capital Market

10

Education Programmes For

work force Indonesia: The introduction of capital market financial

products to the work force Indonesia

INVESTOR EDUCATION PROGRAMMES

EduExpo (InVestival): Educational and Introduction

Capital Market

Capital Market

Book Series

Student and Teacher

Handbook

National Strategy: Framework and Literacy Programmes

Financial Literacy Programmes Investor Education Programmes

11

Implementation Collaboration

Financial Inclusion Programmes

Investment Gallery Mobile: • Introduction of Capital Markets • Financial planning •Products and Services Capital Markets

“Yuk Nabung Saham” is a persuasive campaign for

Indonesian Society to invest

regularly in capital market

The campaign was launched

by the Vice President of

Indonesia

on12 November 2015

FINANCIAL INCLUSION PROGRAMMES

225

IDX Investment

Galleries in

universities

Strategic Initiatives:

National Campaign

Public Education Roadshow

Product Development

University & Community Development

Partners:

IDX Investment Galleries, Securities

Companies, Investment Managers, Listed

Companies, and Communities

INCREASING CAPITAL MARKET LITERACY & INCLUSION RATE AMONG

INDONESIAN SOCIETY

13 Background

Micro Mutual fund programs introduced by

IFSA in 2014. Mutual fund is an investment value Products Small

Enough. Through Investing in mutual funds is

expected to Singer Capital Markets hearts Forms of

mutual funds can be reached by society Secondary

Down.

FINANCIAL INCLUSION PROGRAMMES

Opening Account start from IDR 100K

Micro Mutual Fund

1,395 mutual fund

products, with Net Assets

value of US$23,9 billion

+400,000 mutual fund

investors

National Strategy:

Framework and Literacy Programmes

Financial Literacy Programmes

Investor Programmes

14

Implementation

Collaboration

Financial Inclusion Programmes

15

Collaboration On Education Programmes

“Yuk Nabung Saham”

is a persuasive campaign for

Indonesian Society to invest

regularly in capital market

Public Education Roadshow

University & Community

Development

Product Development : Auto

Investment

16

Socialization, visits to school/university, Seminars, Exhibitions, Workshops,

Training, Brochures, Web, Radio, etc

Financial Services Industries are obliged to implement

financial education

The Activities/Media:

Introduction of Capital Markets, products, risks and benefits, Mutual Funds and

Investment Manager, Trading Competition, Market and product updates, How to

Investing in Mutual Funds, Sharing and discussion on capital market conditions

(market outlook), Introduction to consciously invest early and the foundations of

the Fund, The introduction and opportunity regarding sharia investment.

Investor Educational Program Focus

On:

Collaboration With Financial Industry

17

National Campaign “Ayo Menabung”

For all industries : Banking, Capital Market, Insurance, Finance Companies, Pension Fund, Pawnshop

Collaboration With Financial Industry

Financial Inclusion Month on

October

Campaign Ayo Menabung on

World Saving Day, October

31

18

Collaboration with Financial Services Industry and Goverment

FINANSIAL INCLUSION PROGRAM

e-Identity Card (KTP) as Reference Data Investor.

IFSA, KSEI, and Interior Minister effort to establish a link between

investor database in capital market with citizen data to make a better,

accurate and always up to date information on investors.

Single Investor Identification (SID) in

the capital market is linked to the

citizen’s data administered by Gov’t

Integrated Investment

Management System

100 Securities Companies

participated to shorten time for

opening investment account

2 Week less than 1 Hour Interior

MInister

Central

Custodion

(SRO)

19 Implementation: Strengthening Infrastructure Financial Literacy

MY FINANCE

SAVING

INVESTEMENT

FINANCING

PROTETION

MATERIALS & TOOLS

ACTIVITY

NEWS

20

Implementation: Strengthening Infrastructure Financial Literacy E-Book Learning – Financial Education Content

OJK has provided financial literacy and education materials

through a minisite named sikapiuangmu.ojk.go.id. These web

based materials will be transformed into more animated and

attracting materials, we call it e-book project in 2017

Another Information and materials about

Investment: Stock

Bond

Stock Option

Government Bond

Corporate Sukuk (Sharia Bond)

Retail Sukuk (Sharia Retail Bond)

Mutual Funds

Protected funds

Collective Investment

Contract

etc

The Materials which will be developed ino e-

book for the first term are the formal books for

Elementary

Junior high school and

Seniro high school

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Education Minisite (sikapiuangmu.ojk.go.id) and Mobile

App

Android : https://play.google.com/store/apps/details?id =com.ojk.sikapiuangmu

AppStore : https://itunes.apple.com/id/app/sikapi-uangmu/id1042213585?mt=8

Menu and Services :

Portal Alert

investment

Financial information

Customer service

Financial

Planning

Financial

calculator

Short survey

Financial

calculator

Short survey

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Public income is still relatively low

Challenging

There are opinions:

- Investing in stock is gambling.

- Opening an account in the stock market takes a long time.

- Changing the mindset that only high-income people can be

enter the capital market

The level of public understanding is still low on the

product and capital markets industry

Process requirements that need to be simplified

(simplified know your customer process)

23

Using the social networks to promote the product and capital markets industry.

Create financial education campaign to raise awareness about the need for

financial literacy and publicize financial education activities via social media.

Also Promotional and awareness raising activities regarding the mechanisms

for the protection of financial consumers.

Going Forward

Process requirements that need to be simplified. (For opening a specific account has no KYC complicated).

Capital market education to academics or university and the public by utilizing investment galleries

Incorporate curriculum capital markets on formal education (especially for university curriculum)

National education campaigns

Campaigns to increase knowledge, understanding and skills about investing

in capital market

THANK YOU