QR Code Indonesian Standard
How often do you use the QR code for payment? Do you feel safe paying with QR code? Which do you prefer to pay with QR code or physical cards?
Coinciding with Indonesia’s 74th independence day, Bank Indonesia finally released a standard for the use of QR Codes in Indonesia, which was named QR Code Indonesian Standard (QRIS). That means the payment system using the QR Code will be interrelated and interoperable. The QRIS implementation will take effect on January 1, 2020. If you look back, the QR code has been widely used since 2018. The practical and efficient use of the QR Code makes it a trend of payment methods that replace physical cards which demands the use of EDC (Electronic Data Capture) machine.
Why does payment with QR code in Indonesia require standards? Standardization makes the audit process easy and difficult for scammers to enter. Also, interoperability is important because there is no boundary between each other. With this interoperability, it is expected that all publishers can create QR code that can be scanned by other publishers.
Assistant Governor Head of Payment System Policy Department at Bank Indonesia, Filianingsih Hendarta, said that there are several reasons for Bank Indonesia to make QRIS. One of them is about security issues. She said there were cases of scams in China. The case causing losses of up to USD 13 million. This standardization also aims to create healthy competition. The reason is that the QR Code business market is currently dominated by large operators. With QRIS, it will open space for small operators to compete.
One of the objectives of publishing a QRIS is to support innovation, stabilization and sound business practices, and ensure national interests. Digital wallet platforms such as GoPay, OVO, and Linkaja will use QRIS technology. That will make all merchants who work with QRIS make payments through digital wallets.
The QRIS was prepared by Bank Indonesia and the Indonesian Payment System Association (ASPI), using EMV Co.1 international standards to support the interconnection of wider payment system instruments and accommodate country-specific needs to facilitate interoperability between operators, instruments, or maybe even countries. For the initial stage, QRIS focuses on implementing the QR Code Payment Merchant Presented Mode (MPM) model where the seller (merchant) will display a QR Code of payment to be scanned by the buyer (customer) when making a payment transaction. This method is more efficient and cheaper than the Customer Presented Mode method, which requires the store to have a scanning tool.
There are many advantages of using QR Codes, they are:
- Practical and Efficient
Payment with QR Code is a payment method that is easy, simple, and fast. Transactions can be done simply by scanning the code using the QR Scanner on your smartphone. The process is also faster than using a physical card.
2. Safer
QR payment provides a higher level of security than credit cards, debit cards or other non-cash cards. Users will be asked to enter a PIN or OTP (One Time Password) code every time they make a transaction using QR payment. Well, if we lose our phone, the balance in our digital wallet will remain safe. We just need to download another digital wallet application on the other phone to log out from the application on the old phone.
3. Lots of promos and discounts
Like credit cards, digital wallet applications also provide a variety of promos, discounts, and even cash back. These promos are certainly very beneficial for users to save on expenses.
4. Top-ups Anywhere
To top up your digital wallet balance, you can do it through ATM transfer or mobile banking. Besides, users don’t need to have a bank account first. They can do the top-up the balance through Alfamart, Indomaret, Hypermart, or other offline outlets.
5. Resistance to a disability
QR Code has resistance to a disability, even though the printed QR Code has physical damage or defects up to 30%, it can still be read properly because of the error correction feature. This is used by the company to place its small logo in the middle of the QR Code.
However, this system also has a disadvantage. QR payment needs a good internet connection. Without it, we can’t use it, or maybe a small interruption of internet connection can detain the payment process. So, it can cause a lot of queues. This can be overcome with merchants that provide free WiFi.
In the end, with the QRIS, it is expected to be able to develop the economy and build a cashless society in Indonesia. Although QRIS has been created, there is no guarantee that it can’t make new threats arise. So we must be careful and aware of these new threats.
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