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Preemployment card program helps boost financial inclusion: Director – Business

Preemployment card program helps boost financial inclusion: Director – Business

The government’s preemployment card program has prompted 728,000 underbanked people to board e-wallet platforms and create a bank account for the first time, hence aiding financial inclusion in the country, the program director has said.

Preemployment program executive director Denni P. Purbasari said that currently, there were 5.59 million preemployment card recipients across the country, from 36.6 million online registrants.

“Before joining the preemployment program, 13 percent [of the recipients] did not have an e-wallet or access to the bank, now they do. This 13 percent amounts to around 728,000 people,” Denni said during a press briefing on Wednesday.

She added that 76 percent of the recipients chose an e-wallet as their preferred means of receiving the incentive. Recent data also show that in total, there are around 4 million preemployment card recipients who have an e-wallet account.

Recently, the government added e-wallet DANA as one of its partners in disbursing preemployment cash assistance to participants, alongside other platforms such as GoPay, OVO and LinkAja.

“With the addition of DANA, we are giving the [preemployment card] recipients more e-wallet options to use as an incentive channel,” Denni said.

With an economy contracting 5.32 percent year-on-year (yoy) in the second quarter, the government is confronted with job losses nationwide.

Around 3.7 million individuals have lost their jobs so far this year due to the pandemic, according to data from the National Development Planning Agency (Bappenas), a number that is expected to hit around 10 million by the end of the year.

With a budget of Rp 20 trillion (US$1.3 billion), the preemployment card program is aimed at combining social assistance with upskilling for people affected by the COVID-19 pandemic, including workers and small business owners. It offers monthly assistance of Rp 3.5 million for four months to cover training costs and

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U.S. consumer borrowing falls on smaller credit card balances

U.S. consumer borrowing falls on smaller credit card balances

U.S. consumer borrowing unexpectedly fell in August as credit card balances declined for a sixth consecutive month with the coronavirus pandemic continuing to limit some purchases amid elevated unemployment.

Total credit decreased $7.2 billion from the prior month after an upwardly revised $14.7 billion July gain, Federal Reserve figures showed Wednesday. The median estimate in a Bloomberg survey of economists called for a $14 billion increase in August.

The drop in revolving credit to a three-year low indicates the pace of consumer spending growth is moderating after outsize gains immediately following the gradual lifting of restrictions on businesses and individuals. The expiration of a $600 weekly supplemental benefit for the unemployed may have also played a role in the drop in consumer charges.

The absence of additional government financial support to the millions of unemployed Americans is seen limiting the consumer expenditures that make up the largest share of gross domestic product.

Revolving credit fell $9.4 billion, the most in three months. The decrease left outstanding revolving credit at $985.3 billion, the lowest since June 2017.

Nonrevolving debt, which includes auto and school loans, rose $2.2 billion, though the increase was the smallest since a decrease in April. Lending by the federal government, which is mainly for student loans, increased almost $15 billion before seasonal adjustment.

Total consumer credit for the month fell an annualized 2.1% after growing 4.3% in July. The Fed’s report does not track debt secured by real estate, such as home mortgages.

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