How Indonesia can secure financial transactions

By Adobe

Ming Fai Chak, Head of Solution Consulting, Adobe Southeast Asia, discusses how electronic signatures can tackle fraud and make processes more efficient.

It has been said if you want to change the world, pick up your pen and write. In the 21st century, this statement still holds - though our pen may look something like a stylus instead.

Whether it’s international treaties, financial documents, or contracts, electronic signatures have never been more essential than now. Covid-19 has forced people to work from home - and for businesses and work to go on ‘as usual’, electronic signatures are the way forward.

Ming Fai Chak, Head of Solution Consulting, Adobe Southeast Asia, discusses how Indonesia can use electronic signatures to tackle fraud and streamline transactions.

Streamlining processes

Indonesia is the world’s largest island country with a total of 17,508 islands. Even without Covid-19 restrictions on social distancing, travelling across the country to get a document signed is no easy feat.

Electronic signatures can help organisations overcome such “physical distance barriers”, says Chak. Banks, for example, will be able to electronically deliver services to different parts of the population living in remote areas.

Digitalising signatures also can help organisations become more efficient and free up time to upskill their workforce, he says. Without the hassle of paperwork, and chasing it down, employees can complete tasks faster and are freed up to do more meaningful work.

Artificial intelligence (AI) and machine learning can also improve the process and enhance user experience, Chak says. For instance, AI can turn scanned paper forms into editable digital documents in mere seconds, making it easy to fill up even on mobile devices and then sent along with electronic signatures.

The trade services department at Rabobank Singapore used to take several days to finalise a document. With Adobe Sign, the team now processes time-sensitive transactions in a matter of hours. The IT team also uses electronic signatures to process procurement documents, and HR for recruiting and onboarding new employees.

Tackling fraud

Global financial fraud rates have remained at record highs. PwC’s Global Economic Crime and Fraud survey revealed that companies lost a total of US$42 billion to fraud over the past year.

Electronic signatures can help to tackle fraud, by reducing human intervention. It also gives organisations visibility over the signing process, Chak says. If a paper contract is passed from person to person, there’s little visibility over who’s holding on to the contract and what changes have been made.

“But if you imagine a digital document process that's been automated and that is routed to the right people with proper auditing through every step, that definitely cuts down the chances of fraud,” he adds.

Regulatory standards and support for innovation

Electronic signatures are well-accepted in Indonesia’s legal framework, but uptake hasn’t been as rapid, Chak says. For the country to reap the benefits of this digital process, Indonesia’s business leaders need “more awareness, drive and vision”, he adds.

Covid-19 has been the driver of such digital transformation, as organisations have realised that they need to digitalise processes for business continuity. “You still have to sign contracts with suppliers, with vendors, with new employees or new hires. You have to sign contracts with customers, and all this has to go on while offices are closed and people are staying at home,” says Chak.

Indonesia’s financial regulators can also provide more guidance on e-signature standards, says Chak. While the legislation on electronic signatures has been “quite clear”, there are overlapping areas on data sovereignty or cloud usage that financial institutions are unclear about.

“As long as there isn't complete clarity and guidance, what will happen is that the banks and the institutions will remain quite conservative in this regard,” says Chak.

Lastly, increased government support for innovation will help too, Chak says. As Indonesia continues to develop its infrastructure, it also has to reach rural communities, he adds.

The government can digitalise warungs, or small-family businesses, to do so. “It's a resource, rather than going straight to say consumers in rural areas, who may not have access to these devices,” says Chak.

As Indonesia prepares for the new normal, having clear mandates on electronic signatures and encouraging innovation will propel the nation towards a resilient digital future.