Proceedings of the Asia-Pacific Research in Social Sciences and Humanities Universitas Indonesia Conference (APRISH 2019)

Foreign Ownership and Access to Bank Services in Indonesia

Authors
Rheinhard Yonathan, Dony Abdul Chalid
Corresponding Author
Dony Abdul Chalid
Available Online 31 May 2021.
DOI
https://doi.org/10.2991/assehr.k.210531.067How to use a DOI?
Keywords
Foreign Ownership, Financial Inclusion, MSME Loan, Bank
Abstract

This study aims to analyze the effect of the presence of foreign banks on the access to bank services—in term of the number of automatic teller machines (ATMs), branch offices, and the allocation of credit distribution by banks—to micro, small, and medium enterprises (MSME) in Indonesia. We use data from 63 commercial banks in Indonesia spanning eight years, from 2010 to 2017. We apply a panel data regression to conduct the estimation. This research found that the foreign ownership percentage of a bank does not have a significant effect on the number of ATMs. However, the effect on banks’ branch offices is negative and significant. Moreover, the foreign ownership percentage has a negative influence on MSME lending. Foreign banks’ method of entry through the acquisition of domestic banks or takeovers does not have a significant effect on the number of ATMs owned by banks. However, the effect is significant and positive on banks’ branch offices. A greenfield method was found to have a significant influence on banking accessibility, as illustrated through the number of ATMs owned by banks; however, this effect did not occur for the number of bank branch offices and MSME lending.

Copyright
© 2021, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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Volume Title
Proceedings of the Asia-Pacific Research in Social Sciences and Humanities Universitas Indonesia Conference (APRISH 2019)
Series
Advances in Social Science, Education and Humanities Research
Publication Date
31 May 2021
ISBN
978-94-6239-385-1
ISSN
2352-5398
DOI
https://doi.org/10.2991/assehr.k.210531.067How to use a DOI?
Copyright
© 2021, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Cite this article

TY  - CONF
AU  - Rheinhard Yonathan
AU  - Dony Abdul Chalid
PY  - 2021
DA  - 2021/05/31
TI  - Foreign Ownership and Access to Bank Services in Indonesia
BT  - Proceedings of the Asia-Pacific Research in Social Sciences and Humanities Universitas Indonesia Conference (APRISH 2019)
PB  - Atlantis Press
SP  - 531
EP  - 539
SN  - 2352-5398
UR  - https://doi.org/10.2991/assehr.k.210531.067
DO  - https://doi.org/10.2991/assehr.k.210531.067
ID  - Yonathan2021
ER  -