Covid-19 Background

Corona Virus Disease 2019 also known as Covid-19 is the new virus that
is similar to SARS and MERS that was declared as the global pandemic.
The virus is transmitted through direct contact with respiratory droplets
of an infected person (generated through couching and sneezing), and
touching surfaces contaminated with the virus. The symptoms are
fever, cough and shortness of breath. It was first found at Wuhan,
China, 2019. Until today, there are up to 28 million confirmed cases of
covid-19 with deaths number up to 900 thousand in 216 countries all
over the world. World Health Organizations shared the way to avoid
the risk of infection that are washing hands frequently using soap and
water or an alcohol-based hand rub, cover mouth and nose with mask
when go outside and social distancing.
In the waiting for the treatment or vaccine, ceasing most human
contact is really the only most effective way to stop the spread of the
virus. The countries all over the world are trying to flatten the
exponential curve between their daily number of cases and the capacity
of the healthcare system. One of the best solutions that has been taken
by most of the countries is the lockdown. The policy of lockdown that
has been taken by governments all over the world has immense social
and economic disruptions. After around 9 months surviving from the
pandemic, some of the countries has started reopening their business,
public areas and more with the “new normal” behavior as the respond
to deal with this condition.
New Normal
Since the interaction between human must be ceased, there is
a shifting behavior from the past modern activities to the new
one. People are getting used to work remotely from home since
the office apply the work from home methods. Beside that, the
lockdown has made online shopping become the needs for the
people to fulfill their daily needs and the subscriptions for the
entertainment. Overall, the shifting behavior most likely to be
digital-based use.
Covid-19 has a tremendous impact on the economic growth,
since its disrupts the industries from the retailers, small and
medium size enterprises and even the corporates. One of the
industry that is affected by this pandemic is the bank industry.
What is bank?
Bank is the financial institutions that collect and
distribute costumers’ fund through saving and
credits or loans. In this pandemic situation,
bank company must ensure the business
survival by shoring up their operations and
implement new approaches to mitigate
operational disruptions. The three income
sources for bank are asset through credit
management, liabilities through saving
managements and fee- based income through
the costumers’ transactions. During the covid-
19 pandemic, bank companies are facing the
government’s policy to relief financial for the
bank’s costumers due to the borrower’s severe
conditions. The biggest challenge is the
uncertainty of when this pandemic will have an
end.
As covid-19 restricts the interaction of human,
bank must change their traditional banking
habit. While bank industry is in full business
continuity, they are also addressing the
immediate challenges of protecting their staff.
Bank industry must find their own new normal
to be adapted in facing the pandemic. Digital
banking is one of the solutions to survive from
the uncertainty that has been faced by bank
industries.
The condition that force people to adapt with
the digital-based lifestyle is the biggest
opportunities for the bank industries to survive
and to be implemented in the post covid-19
era. This can be said because covid-19
pandemic is the catalyst for the markets to be
ready for the digital banking platform which
was developed slowly before the pandemics.
This opportunity must be used effectively by
the bank company through developing their
digital platform that could give the services
fully. Fee-based income could be the biggest
opportunities for the bank industry post covid-
19. This opportunities could be used effectively
if the bank start creating the end-to-end digital
platform that could catch overall transactions in
all scale both retail and wholesale.
As the new normal habits are predicted to remain in post covid-19 era, bank industries must

have had created that strong digital platform. Example for the retail scale, bank companies will have
great opportunities if they could catch all the needs of their costumers from the morning to the night,
from their transaction of food delivery to their online shopping. Collaboration with the financial
technology which has been started from now, like QRIS digital platform by Bank Indonesia could be the
great starting point for this opportunities.

Next, for the bigger wholesale scale, the bank company should build strong cash management system
within the digital platform. This system could catch all the corporate activity like salary payment, etc.
which could increase the transactions numbers of the costumers in the bigger scale. Beside that, for the
wholesale scale, bank companies also should distribute the credit for the selected companies that are
safe or still growing during the pandemic which could fulfill the risk acceptance criterion, for example
kimia farma, cycling industry, etc. Distribute the credit not only for the main company but also until the
downstream, to chase value chain of the corporate and to create early warning system for the bank
company if the creditor will no longer can afford it.

So, in conclusion, although the covid-19 gives severe impact for the bank industries, it also could be the
catalyst that arise greater opportunities to build the new face of digital banking.