The Indonesian Central Bank issue a new regulation that regulates banks’ ability to outsource works to a third party. The Central Bank regulation No 13/25/PBI/2011 is aimed so that banks are more selective in selecting an outsource company in order to maintain the level of service to the bank customers.
The Central Bank says that they have coordinated with other parties such as Manpower Ministry, bankers and outsourcing providers associations when designing the regulation.
Central Bank Limiting Bank use of Outsourcing Staff
One of the cases that started the discussion about outsourcing is the death of a bank customer resulted of allegedly an intimidation of a bank debt collectors. The bank in questions deflects responsibility because the particular debt collector is not directly hired by the bank but instead working for an outsourcing company that in turn contracted for collection work by the bank.
Amongst many new procedures in the new regulation, the one that stud up is the division of main job and supporting job in a bank. Outsourcing is only allowed for works that are classified as supporting job while main job can only be undertaken by the banks own employee.
Jobs that are classified as main jobs are tellers, customer services, credit analysts, account officers and debt collection. Most of banks in Indonesia usually contracted these kinds of jobs to a third party.
“Works related to the bank core business must be done directly by the bank” says DarminNasution the Central Bank Governor.
This new regulation will undoubtedly increase the expenditure of banks, however, the cost are worth it in the long run as the bank image will improve and get more customers. The Central Bank Research and Control Deputy Irwan Lubis says that the cost increase estimation will not be more than 0.3 % because the biggest cost in banks are usually in cost of fund rather than operational.
Some of the clauses in the new regulation are
- Making it the bank responsibility rather than the outsource companies should the action of outsource companies hired by the bank causing a loss for customers.
- Banks also need to report it outsources usage and can only contract outsource companies that are reputable and legal.
- Failing to report will be fined ranging from USD 100 to USD 10,000.
Banks are expected to comply with the regulation within one year and instructed to not pass the cost increase to its customers.
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