STRATEGIC COLLABORATION BETWEEN RURAL BANK AND P2P LENDING (CASE STUDY: ANS GROUP BPR

• Main Author: Hermawan, Irwan
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/60953
• Institution: Institut Teknologi Bandung

The fast changing of technology along with increasing smartphone and internet penetration are changing the landscape of banking and financial industry tremendously in the past decade. Fintech P2P lending companies as the new players bringing in the mission of increasing financial inclusion especially for the unbanked population in developing countries such as Indonesia. The same mission has always embedded in the Rural Banks (Bank Perkreditan Rakyat) specially ANS Group BPR, a group of 8 BPR with more than 54 branches and assets more than 700 billion rupiah, which has existed more than 16 years in reaching and helping the rural communities getting the financial services. Nevertheless, rural bank traditional method in doing business is struggling in catching up with the new technology. On the other hand, the tech savvy Fintech P2P lending platforms are lacking license to provide customers with wider banking services. This condition leaves gap for both industry which can be filled by Rural Banks collaboration with P2P lending. The study is trying to approach the gap with qualitative analysis by applying PESTEL, Porter’s Five Forces and VRIO to understand the state of play in rural banking and Fintech P2P lending industry followed by interview with industry experts and players. Furthermore, discounted cash flow (DCF) valuation method using free cash flow to equity (FCFE) is used to evaluate which collaboration scheme is suitable for ANS Group BPR. The study shows that there are four of collaboration scheme that suitable and can be implemented between ANS Group BPR and Fintech P2P lending. The FCFE analysis shows that channeling from P2P lending to BPR has the potential to give the highest equity value to BPR that has high capital adequacy ratio (CAR). While the channeling from BPR to P2P lending is more suitable for BPR that have limited CAR.