International Journal of Civil Engineering and Technology (IJCIET) Volume 9, Issue 11, November 2018, 201 pp. 2834–2837, Article ID: IJCIET_09_11_283 IJCIET_09_11_28 Available online at http://www.iaeme.com/ijciet/issues.asp?JType=IJCIET&VType= http://www.iaeme.com/ijciet/issues.asp?JType=IJCIET&VType=9&IType=11 ISSN Print: 0976-6308 6308 and ISSN Online: 0976-6316 0976 ©IAEME Publication
Scopus Indexed
IMPLEMENTATION OF THE THE FIVE CS OF CREDIT IN THE CARD ISSUANCE PROCESS Conie Pania Putri Student of Doctoral Program of Law Universitas Borobudur, Jakarta, Indonesia Fatria Khairo Student of Doctoral Program of Law Universitas Borobudur, Jakarta, Indonesia Faisal Santiago Faculty of Law, Universitas Borobudur, Jakarta, Indonesia Firman Freaddy Busroh Lecturer at Sumpah Pemuda School of Law, Palembang ABSTRACT The five Cs of credit (Character, Capacity/Cash Cash flow, Condition, Capital, and Collateral)is is absolutely necessary to see the card holder's validity. In reality, in the field, there are still many cases of application fraud because the application of 5C of Credit has not been tightened. To overcome the widespread cases fraud application, credit card companies must really look at the prospective validity cardholders. Cite this Article: Conie Pania Putri, Fatria Khairo, Faisal Santiago and Firman Freaddy Busroh, Implementation of The Five Cs of Credit In The Card Issuance Process, International Journal of Civil Engineering and Technology (IJCIET) 9(11), 2018, pp. 2834–2837. http://www.iaeme.com/IJCIET/issues.asp?JType=IJCIET&VType=9&IType=11
1. INTRODUCTION In order to realize a just, prosperous and prosperous Indonesian society based on Pancasila and the 1945 Constitution, the foundation of sustainability and improvement improveme in the implementation of national development that is family-based, family based, needs to be maintained properly and properly. In order to achieve this goal, the implementation of economic development must pay more attention to harmony, harmony, and balance of the elements elements of equitable development, economic growth, and national stability. Facilities that have a strategic role in harmonizing and balancing each element of the Development Trilogy are the banking sector. As we know the main function of the bank is as a vehicle ehicle that can collect and channel public funds effectively and efficiently, which based on http://www.iaeme.com/IJCIET/index. IJCIET/index.asp
2834
[email protected]
Implementation of The Five Cs of Credit In The Card Issuance Process
economic democracy supports the implementation of national development in order to increase equitable development and its results and increase economic growth and national stability towards increasing standard of living for many people (M. Sholehuddin, 1997). Banking as one of the supporting sectors for continuity and improvement in the implementation of development provides various kinds of facilities, including providing services and services that are sophisticated and modern. Services or services provided by these banks can be in the form of demand deposits, checks, time deposits, ATMs, credit cards or services through computers or the internet. With the increasingly sophisticated and modern services and services provided by banks that have a positive impact on the community using bank services, including facilitating the public to use bank facilities, on the negative side brings the emergence of a crime with a new modus operandi in the banking world that cannot be touched by law enforcement officials. One of the modus operandi of the new banking crime is by using a credit card. Banking crime by using this facility is difficult to be captured and investigated by law enforcers because usually the people are genius-thinking people, intellectuals and people from above and added by using sophisticated and modern facilities. The practitioners and academics usually call it the white-collar crime. The originator of the term white-collar crime was Edward A. Ross and then popularized by EH Sutherland in 1949. As we know, one of the functions and duties of the bank is to create payment instruments from non-existing ones. It was also seen by the creation of ATM cards, credit cards and other services using the ease of internet facilities or computers created by the bank itself. The rise of plastic card users in the community raises a thought for people who have an interest in creating a new and more modern crime modus operandi by using the sophistication and intelligence possessed in the form of a high-class crime. But in this case, the author only highlights the small scope of one of the modus operandi that occurs in current credit cards, namely regarding fraud applications. Because maybe, in this case, we can all be the perpetrators of this modus operandi. From the description, the authors are interested in writing in the article entitled: Application of The five C's of Credit in the process of issuing credit cards.
2. PROBLEMS From the description of the background, the problems in this writing are: •
Why is it necessary for five C's of Credit in the process of issuing credit cards?
•
Has the application of The five C's of Credit really been applied in the process of issuing credit cards?
3. DISCUSSION 1.Required Five C's of Credit is in the process of issuing credit cards. Plastic cards or credit cards are card-shaped instruments issued by a financial institution and can be used for various types of financial transactions. The development of the use of plastic cards in various forms shows that this tool is not only used as a means of payment but also for other purposes such as cash withdrawals. Based on considerations that can be carried around practically, it can be used at any time and other ease of use This plastic card is increasingly used for various types of financial transactions, (Sigit Triandaru & Totok Budisantoso, 2006).
http://www.iaeme.com/IJCIET/index.asp
2835
[email protected]
Conie Pania Putri, Fatria Khairo, Faisal Santiago and Firman Freaddy Busroh
In the Encyclopedia of Banking law, credit cards are interpreted as follows: "The term credit card is generally the plastic card that enables the holder to be cashed in," he said. which involves night and obligations between the parties concern ". According to Munir Fuady, a Credit Card is a card that is generally made of plastic material, with the identity of the holder and its issuance, which gives the rights to whom the credit card is rumored to sign a sign of repayment of the price of services or goods purchased in certain places, such as shops, hotels, restaurants etc. The use of plastic cards in Indonesia is still relatively new, around the eighties. The issuance of the Minister of Finance Decree Number 1251 / KMK.013/ 1988 on December 20 has changed the map of the spread of plastic cards more widely. Based on the decree, the plastic card business is classified as a financing service business group. Things that must be considered for credit applications, among others, which are known as 5C of Credit, namely: 1. Character That is the character of people who will be given a credit card, honesty, sincerity in fulfilling promises and desires to fulfill promises. 2. Capacity Is a measure of managerial skills 3. Collateral Is a guarantee from the holder if he does not want to pay, he can sell goods that are collateral. 4. Capital Size about sources of capital owned 5. The condition of economic Economic Conditions when asking to become a member, in a stable or not. (R. Tjiptoadinugroho, 1994). Before the issuance of credit cards by the issuer, it is always preceded by a legal relationship between the parties. Every credit card issuance always involves three parties, namely issuers, cardholders, and merchants. Among the conditions that must be taken in issuing credit cards are special conditions. These conditions we are familiar with 5C of Credit. (Joni Emirzon, 2002). In this case, the bank conducts an inspection of the place of business/guarantee to assess the truth of the data and information provided by prospective credit recipients and obtain data and other information to complete the data and information that already exists. Thus the bank can find out who and how the prospective recipient of the credit. In other words, the credibility of the prospective credit card holder must be considered, because it relates to his ability to pay for the credit card he uses. 2.application of TheThe five C's of Credit is already fully implemented in the process of issuing credit cards. Misuse of credit cards has several modus operandi including: Fraud Application ( Using original credit cards obtained with fake applications/data). Actors falsify biodata, including KTP (address), passport, bank statement, income statement, and reference. Furthermore, the actors register themselves with the publisher to get a credit card. After being successfully accepted as a credit card holder, the transaction is repeated many times, the value of which is getting bigger and bigger and suddenly running away or
http://www.iaeme.com/IJCIET/index.asp
2836
[email protected]
Implementation of The Five Cs of Credit In The Card Issuance Process
disappearing without fulfilling its obligations as a cardholder, namely paying for the use of his credit card. The development of carding cases in Indonesia is moving very fast. According to the results of the latest research conducted by the Clearcommerce security company based in Texas stated that Indonesia was ranked first in the country of origin of perpetrators cyber fraud. He added that around 20 percent of total credit card transactions from Indonesia through the internet are cyber fraud. The research also surveyed 1,137 merchants, 6 million transactions, 40 thousand customers, which began in mid-2000 until the end of 2001. (Farouk Muhammad & Hermawan Sulistyo, 2006). Looking at the facts above, we can conclude that it seems that the implementation of the 5C of credit has not been fully carried out by credit card providers. As the writer sees in the field, there are a lot of credit card companies with very easy procedures so that credit card issuance will soon be fulfilled. This phenomenon has not revealed the motive whether the application of 5C of Credit is considered not so important or indeed the behavior of our nation which is indeed very skilled in terms of fraud. Or also the company's demands to get as many customers as possible.
4. CLOSING 5C of credit is absolutely necessary to see the card holder's validity. In reality, in the field, there are still many cases of application fraud because the application of 5C of Credit has not been tightened. To overcome the widespread cases fraud application, credit card companies must really look at the prospective validity cardholders.
REFERENCES [1] [2] [3] [4] [5] [6] [7]
[8] [9] [10]
Farouk Muhammad & Hermawan Sulistyo, Carding Modus Operandi Investigation, and Enforcement, Pencil 324, Jakarta, 2006. Joni Emirzon, Securities Law and Its Development in Indonesia, PT. Prenhallindo, Jakarta, 2002. Sholehuddin, Banking Crime, PT. Raja Grafindo Persada, Jakarta, 1997. R. Tjiptoadinugroho, Banking Problems on Credit, Understanding, Analysis and Guide, PT. Pradnya Paramita, Jakarta, 1994. Santiago, F . 2017. A Legal Perspective of the Law Enforcement of Land Dispute. European Research Studies Journal (ERSJ) Vol XX, Issue 4B, 2017, P. 578-587 Santiago, F. 2017. Implementation of The Role of Notary Through Capital Market in The Era of Asean Economic Community, International Journal of Civil Engineering and Technology (IJCIET) Vol.8, Issue 8, 1054-1059 Santiago, F. 2017. Trade Secret Protection on Globalization Era. European Research Studies XX (4A), 66-76. Santiago, F. 2018. Banking Responsibility to Customers. European Research Studies XXI (1A), 321-330. Sigit Triandaru & Totok Budisantoso, Other Banks and Financial Institutions, Issue 2, Salemba Empat, Jakarta, 2006.
http://www.iaeme.com/IJCIET/index.asp
2837
[email protected] 
