2021 2025 THE INDONESIAN FINANCIAL SERVICES SECTOR MASTER PLAN - to Recover the National Economy and Enhance the Financial Services Sector ...
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THE INDONESIAN FINANCIAL 2021
SERVICES SECTOR MASTER PLAN
to Recover the National Economy and
Enhance the Financial Services Sector Resiliency and Competitiveness 2025
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS i
ii 2021-2025 The Indonesian Financial Services Sector Master Plan
THE INDONESIAN FINANCIAL
SERVICES SECTOR MASTER PLAN
to Recover the National Economy and
Enhance the Financial Services Sector Resiliency and Competitiveness
2021-2025
Publisher:
Indonesia Financial Services Authority (OJK)
Gedung Soemitro Djojohadikusumo
Jalan Lapangan Banteng Timur 2-4
Jakarta 10710
(021) 29600 000
This publication is available on the OJK website
www.ojk.go.id
December 2020
All rights reserved
Reproduction of this paper in the form and manner
without the written permission of the publisher is prohibited
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS iii
> Executive Summary iv 2021-2025 The Indonesian Financial Services Sector Master Plan
THE INDONESIAN FINANCIAL 2021
SERVICES SECTOR MASTER PLAN
to Recover the National Economy and
Enhance the Financial Services Sector Resiliency and Competitiveness 2025
> Executive Summary
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS 1
Praise the Lord God Almighty, for the abundance of His blessings and grace on the
Foreword completion of the Indonesian Financial Services Sector Master Plan (MPSJKI) 2021-2025,
“To Recover the National Economy and Enhance the Financial Services Sector Resiliency
and Competitiveness” by the Indonesian Financial Services Authority (Otoritas Jasa
Keuangan-OJK). The theme was chosen to portray the direction in terms of advancing the
financial services sector (FSS) as well as OJK's future commitments which focuses on
the national economic recovery in the context of handling the impact from the Covid-19
pandemic as well as building confidence to develop resilience and preparing the FSS to
regional and global competition.
Following on Act No. 21 of 2011 concerning the Financial Services Authority, OJK
was established to ensure all activities in the FSS are managed in an orderly, fair,
transparent and accountable manner; to create a sustainable and stable financial
system; and to protect the interests of consumers and public alike. As a manifestation
of this goal, OJK needs to set a future policy direction that is in harmony with the latest
dynamics of the FSS.
The endeavours to develop the FSS are exposed with various challenges, both from
global and domestic economic uncertainties. Global challenges derived from the
slowing down of the economy, ongoing trade war, increasing signs of protectionism
and uncertainty in the global financial markets. Meanwhile, domestic challenges
emerge from the ongoing current account deficit; limited long-term economic financing
sources; economic and income inequality; low levels of productivity and competitiveness
nationally; inadequate sustainable economic financing; inconsistency in the regulation
and supervision of FSS; low financial literacy and inclusion; as well as the current
revolution because of the disruption in the digital economy era. At the same time,
stakeholders' expectations of the future role of the FSS have also increased as the
Indonesian economy has reached the welfare level which is equivalent to that of upper
Middle Income Countries.
Considering that, OJK has prepared the MPSJKI as a basis framework for the strategic
direction of the FSS that is align with the main national development framework as set
out in the 2020-2024 Medium Term National Development Plan (RPJMN). MPSJKI is
planned to be published in the first quarter of 2020. However, considering the impact
of the Covid-19 pandemic on the condition of the FSS and the economy, a revision was
carried out so that the structure of the MPSJKI consisted of the Short-Term FSS Policy
Direction (2020-2021) - FSS Support for the National Economic Recovery Program
(PEN) and the 2021-2025 Structural Framework which focuses on three areas, namely:
(1) Strengthening Resilience and Competitiveness ; (2) Financial Services Ecosystem
Development; and (3) Digital Transformation Acceleration. Additionally, the 2021-2025
MPSJKI focuses on collaboration and cooperation among stakeholders as the main
enablers for its targets.
Lastly, on behalf of the Board of Commissioners of OJK, we would like to express
our appreciation to all parties who participated in the preparation of this MPSJKI. We
sincerely hope that the 2021-2025 MPSJKI will be used as a reference for all industry
players and stakeholders in terms of advancing the FSS in Indonesia, thereby allowing
the sectors to provide greater value added to the national economy in order to improve
public and economic welfare while maintaining financial system stability.
Prof. Wimboh Santoso, SE., Msc., Ph.D
Chairman of the Board of Commissioner
Indonesia Financial Services Authority
2 2021-2025 The Indonesian Financial Services Sector Master Plan
Table of Contents
Condition of The
Financial Services
11
Sector
OJK Coincidence Index 11
Snapshot of The Development of 12
Indonesia’s Financial Services Sector
for 2015-2019 and Quarter II 2020
Foreword 2
Subsequent Events of Financial 13
Services Sector Conditions
Table of Contents 3
Micro Finance Institution, Other 15
Specialized Financial Service
Executive
Summary
4 Institution and Peer-to-Peer
Lending Fintech Development
Financial Conglomerates and Digital 16
Financial Innovation Development
Global and
Domestic 7 Level of Financial Literacy and
Inclusion
17
Economic Review
Global Economic Conditions and 7
Challenges Ahead 18
Domestic Before the Covid-19 Short-Term Challenges 18
Pandemic
Structural Challenges 19
The Impact of the Covid-19 8
The Indonesian
22
Pandemic on the Global and
Domestic Economy
Financial Services
Response to
The Impact of 10 Sector Master Plan
2021-2025
Covid-19 Short-Term Financial Services 23
Sector Policy Direction (2020-2021)
- Financial Services Sector Support
for the National Economic Recovery
Program
Structural Framework 2021-2025: 26
Enhance the Financial
Services Sector Resiliency and
Competitiveness
Collaboration and Cooperation 44
between Stakeholders as Enablers
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS 3
Executive Summary
Indonesia's financial services sector (FSS) continues public pretection. As one
to experience positive developments despite the manifestation of these goals,
downturn in global and domestic economic growth OJK sets a future policy direction
over the past five years and the impact of the Covid-19 that is consistent with the latest FSS
pandemic in 2020. However, this positive achievement dynamics.
should not lead to complacency. Moving forward, the
FSS will continue to face various challenges arising The future policy direction is outlined in
from economic uncertainty and developments in the The Indonesian Financial Services Sector Master
digital economy that are disrupting business models. Plan (MPSJKI). The MPSJKI consists of the basic
Additionally, the FSS as the mainstay of the economy framework for the strategic direction of fostering
is increasingly required to maintain financial system integrated and comprehensive FSS. MPSJKI serves as
stability and to be able to increase competitiveness, so a guideline for the development of the FSS to create a
that it will make an optimal contribution to support a stable, contributive and inclusive financial industry to
sustainable and inclusive national economic growth. To support Indonesia's economic growth.
face these challenges, a strategic policy direction for
the development of the FSS is required as a reference In 2015, OJK issued the 2015-2019 MPSJKI which aims
for all stakeholders. to strengthen the role of FSS in national economic
activities, both in the context of providing financing
The Indonesia Financial Services Authority (Otoritas for the development and making Indonesia one of the
Jasa Keuangan or OJK) has a strong commitment in main investment destination countries. The 2015-2019
enhancing the role of the FSS in spurring economic MPSJKI version contains three strategic directions for
growth, while maintaining stability of the financial the development of the FSS, which are (1) optimizing
system. From the Act No. 21 of 2011 concerning the the role of the FSS in supporting the acceleration of
Financial Services Authority, OJK was formed with national economic growth (contributive); (2) maintaining
the vision that all activities within the monitoring of financial system stability as a foundation for
the FSS industry are carried out regularly, fairly, sustainable (stable) development; and (3) developing
transparently and accountable; able to develop a financial independence for the people and supporting
financial system that grows in a sustainable and stable efforts in decreasing inequality in country’s economic
manner; and upholding the principles of customer and development development (inclusive).
The Goals and Directions of The Indonesia Financial Services Sector Development
The Realization of a Stable FSS that Contributes Significantly to Sustainable Economic Growth to Improve the Welfare of the Indonesian People
Three Directions of Development in the MPSJKI
The 2015-2019 MPSJKI
CONTRIBUTIVE STABLE INCLUSIVE
ENABLER
Fulfillment of the Quantity and Quality of Human Capital Utilization of technology in FSS Activities
CONTRIBUTIVE STABLE INCLUSIVE ENABLER
> Executive Summary
• Financing for infrastructure and priority • Strengthening FSS supervision • Developing regional economic potential • Fulfillment of the quantity and quality
economic sectors • Strengthening and structuring the FSS • Expanding financial access and of human resources in the FSS and the
• Strengthening the capacity of the FSS according to standards strengthening consumer protection supervision of FSS
• Development of FSS products and • Utilization of information in FSS
services as well as increasing financial economic activities
literacy
• Strengthening the role of Sharia FSS
4 2021-2025 The Indonesian Financial Services Sector Master Plan
Presidential Directive and the
National Development Agenda
Generally, the contributive pillar will be implemented
through financing towards the infrastructure sector and Vision & Mission of The President
priority economic sectors, including tourism, housing,
oil palm plantations, export-oriented industries and 1
Improving the quality
2
A productive,
independent, and
of Indonesia’s human
the creative economy; increasing the role of the FSS in capital development competitive economic
supporting economic activities by way of strengthening structure
capital capacity and empowering the role of industry
Equitable and fair Achieving a
association; development of FSS products and services as 3 development
4 sustainable living
well as increasing of financial inclusion and literation; and environment
strengthening the Sharia FSS, which include establishing
Micro Waqf Bank (Bank Wakaf Mikro or BWM) to encourage Cultural progress that Corruption-free,
5 6 dignified, and reliable
greater equitable access to finance and public welfare, reflects the national
law enforcement
principles
especially in the area around Islamic boarding schools
(pondok pesantren). The stable pillar will be carried out
by strengthening the supervision of the FSS, including 7
Protection for the entire
8
Trustworthy,
nation and provide a effective, and reliable
through integrated supervision, law enforcement, sense of security for all governance by the
implementation of crisis management protocols and citizens Government
structuring the FSS in accordance with international
The synergy of local regional Governments within the
standards. The inclusion pillar will be realized by 9 framework of a united nation
fostering regional economic potential, among others by
issuing regulations on Regional Securities Company;
expanding financial access, among others, by regulating
and monitoring Peer-To-Peer (P2P) Lending (fintech)
industry, Branchless Banking (Laku Pandai), Digital l
Inf
ita De rast
Financial Innovation (Inovasi Keuangan Digital or DFI) and C ap ent ve ru
lop ctu
Equity Crowdfunding (ECF); and increasing consumer an m me re
m lop
Hu eve nt
protection principles. D
The various strategic directions outlined in the 2015-2019 Presidential
Tra
MPSJKI have been implemented and well accomplished. Directive
on
Eco rmati
n
nsf
Sim ulatio
cati
This achievement has been reflected in the continued state
nom on
o
plifi
of financial system stability, increasing assets of Financial
Reg
ic
Service Institutions (FSIs) and their role in the development
of the national economic growth, as well as increasing Bureaucratic
levels of financial inclusion in supporting the endeavours to Simplification
lessen the economic inequality gap and support equitable
distribution of public welfare.
However, the actions to develop the FSS remain exposed to
various challenges, both in short term as well as structural 7 Development Agendas
longer term challenges. Short term challenges derives (National Priorities)
from the uncertainty from the Covid-19 pandemic that will
influence the capacity on demand and purchasing power of 1 Economic Resilience
for a quality and fair
2 Regional
development to
the consumers, as well as the production and distribution development reduce inequality
of goods and servides; financing support in the medium and
long term for the National Economic Recovery Programs
(Pemulihan Ekonomi Nasional-PEN); financial market
3 Quality and
competitive human
4 Quality and
competitive
human capital
conditions that still have the potential to experience high capital development development
volatility; as well as the sustainability of the Government’s
(PEN) policy incentives and the normalization stages after 5 Infrastructure for
economy and basic
6 Environment,
disaster resilience,
public services
the pandemic. and climate change
Structural longer term challenges globally derives from 7 Politics, rule of
> Executive Summary
law, human right
stability; and
the downturn in global economic growth, the ongoing public services
trade war, increasing signs of protectionism and transformation
uncertainty in global financial markets.
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS 5
The 2020-2024 ASEAN Financial Integration
RPJMN Targets Framework
Indonesian
Economic Growth
5,7% - 6,0% ASEAN
Financial Integration
Framework
GDP by Production Approach
Manufacturing
6.2% - 6.5% GDP by Expenditure Approach
Household Consumption & NPISH Capital
Agriculture
5.4% - 5.6% Financial
3.8% - 3.9% Account Capital Market
Services Liberalization Development
Government Consumption Liberalization
Trade
4.7% - 4.9%
6.0% - 6.3%
Investasi
Financial Service
6.6% - 7.0%
6.8% - 7.2%
Other Financial Initiatives:
Information and Communication Export • ASEAN Capital Markets Forum (ACMF)
8.3% - 8.9% 4.7% - 4.9% • ASEAN Banking Integration Framework (ABIF)
• Payment and Settlement Systems (PSS)
Construction Import
• Financial Inclusion (FINC)
6.1% - 6.4% 4.7% - 4.8%
• ASEAN Forum on Taxation (AFT)
Mining Source: National Development Planning • ASEAN Insurance Cooperation & Forum
1.9% - 2.0% Agency (Bappenas), 2020
Source: ASEAN Secretariat, 2020
Meanwhile, domestic challenges emerge from the must improve in efficiency, variety of products and
ongoing current account deficit, limited long-term services introduced, and excellent service, including
sources of economic financing, economic inequality taking advantage of technological developments.
and income disparity, low levels of productivity and Adequate capacity and capability are also keys to
competitiveness, inadequate sustainable economic increasing the contribution and competitiveness of
financing, and regulatory and supervisory gaps across the FSS.
the FSS, low financial literacy and inclusion, and
disruption of the revolution in the digital economy era. To face various conditions and challenges outlined
above, OJK considers it necessary to formulate the
At the same time, stakeholders' expectations of the 2021-2025 MPSJKI as a basis framework for the
role of FSS in the future have also increased with the strategic direction of the FSS's strategic policies.
growing Indonesian economy which has reached the The MPSJKI is a response to the dynamic global and
level of welfare equivalent to those of upper Middle domestic economy challenges, public expectations
Income Countries. In this case, the Government has towards the FSS, and is aligned with the main
established the 2020-2024 Medium Term National national development agenda as stated in the 2020-
Development Plan (Rencana Pembangunan Jangka 2024 RPJMN.
Menengah Nasional or RPJMN) which contains national
development targets for the next five years. This MPSJKI is planned to be published in the first quarter
RPJMN requires substantial financial support including of 2020. However, considering the impact of the
from the FSS so that national economic development Covid-19 pandemic on the condition of the FSS and
targets can be achieved. the economy, a revision was carried out so that the
structure of the MPSJKI consisted of the Short-Term
Additionally, economic and financial activities in the FSS Policy Direction (2020-2021) - FSS Support for
region are increasingly integrated with the initiative the National Economic Recovery Program (PEN) and
of the ASEAN Economic Community. On the one hand, the 2021-2025 Structural Framework which focuses
this integration brings opportunities by opening up on three areas, namely: (1) Strengthening Resilience
market share in the region. On the other hand, this and Competitiveness; (2) Development of Financial
integration will further increase the competition. As Services Ecosystem; and (3) Digital Transformation
a consequence, high competitiveness in the domestic Acceleration. In addition, MPSJKI 2021-2025 will
> Executive Summary
FSS is an inevitable demand for market players so mainstream the collaboration and cooperation
that in the end Indonesia can take advantage of this among stakeholders as the main enablers for its
economic integration. Consequently, the national FSS achievements.
6 2021-2025 The Indonesian Financial Services Sector Master PlanGlobal and
Domestic
Economic Review
Global Economic Conditions and
Domestic Before the Covid-19 Pandemic
Decline of Commodity Prices
Index 2016 = 100
250
EXTERNAL 200
• Trade War
FACTORS 150 128.06
108.89
• Global Trade 100
99.89
Downturn 50
• Geopolitical 0
Dec-08
Dec-09
Dec-10
Dec-11
Dec-12
Dec-13
Dec-14
Dec-15
Dec-16
Dec-17
Dec-18
Dec-19
Dynamics
Non-Oil and Gas Agriculture Mining
GLOBAL ECONOMIC
GROWTH
External factors affect the economy and
2015 2019 domestic financial (vice versa)
3.5% 3.3%
FISCAL FINANCIAL MONETARY
POLICY SECTOR POLICY • Interest Rate
• Issuance of • Monetary and
Government Macroprudential
Securities Policy
• State Spending Transmission
• Tax
• Household Consumption
REAL Balance
SECTOR • Inflation
> Global and Domestic Economic Review
• Credit and NPL
• Market Price
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS 7The Impact of The Covid-19 Pandemic on
The Global and Domestic Economy
Covid-19 and Public Health
Emergency
At the end of 2019, the Covid-19 virus began to infect
China and then spread to various countries in the
world. On March 11, 2020, WHO declared Covid-19 a
global pandemic. Until now, the Covid-19 pandemic is
still unknown when it will end.
Map of the Covid-19 Spread in Indonesia
Recovered
349.160 Confirmed 78,4%
273.661
Cases from
Confirmed
Active Case Deaths
63.231 18,1% 12.268 3,5%
from from
Confirmed Confirmed
Source: covid19.go.id (14 October 2020)
Various countries including Indonesia have adopted
strict social restriction policies in order to mitigate the
> Global and Domestic Economic Review
spread of Covid-19.
8 2021-2025 The Indonesian Financial Services Sector Master PlanCovid-19 Encumbers the Economy
The Covid -19 pandemic pressured the economy both in terms of demand and supply. The decline in demand and
supply stemmed from problems with medical, businesses performance, and expectations.
Economic Sectors Affected by Covid-19 Consumer Confidence Index
Index
IMPACT LEVELS AFFECTED SECTORS 135
130
HIGH IMPACT • Tourism 120.5
125
120.0
(Turnover decreased by • Manufacture 119.8 120
> 30%) • Building materials, heavy 119.7
115
equipment
110
• Property and construction
105
• Pharmacy Optimistic
100
MEDIUM IMPACT • Multifinance Pessimistic
95
(Turnover decreased by • Automotive I II III IV I II III IV I II III IV I 7 8 9 10 11 12 1 2
10-30%) • Shopping center
2017
2018
2019
2020
2019
2020
• Animal husbandry, fisheries
• Distribution/retailler of non- Expenditure of IDR 1-2 Million Expenditure of IDR 2-5 Million Expenditure of > IDR 5 Million
essential goods Source: Bank Indonesia
• Commodities (plantation,
mining) Foreign Investment
LOW IMPACT • Packaging
(Turnover decreased by • E-commerce Others
20,1% 28,8%
Singapore
US$ 1,3 M US$ 2,0 M
Global and Domestic Economic Review
60 prices per barel
40
Lifting petroleum
20
0 677-737 thousand
barrels per day
-20
-40 Lifting natural gas
-60
1,085-1,173 thousand
Mar 18
May 18
Jul 18
Sep 18
Nov 18
Jan 19
Mar 19
May 19
Jul 19
Sep 19
Nov 19
Jan 20
Mar20
May 20
barrels per day
Source: Ministry of Finance
Source: Statistics Indonesia (BPS)
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS 9Response to
The Impact of
Covid-19
Since the announcement of Covid-19 as a pandemic by In order to follow up Article 11 of Act 2/2020, the
WHO on March 11, 2020, the Government has issued a Government implemented the National Economic
series of policies to prevent the spread of the impact of Recovery Program (PEN) as a measure to protect,
the Covid-19 pandemic. A number of stimuli have been maintain and improve the economic capacity of
issued, including fiscal, monetary, and FSS stimuli. business actors from the real sector and the financial
An effective policy mix is essential to prevent the sector in carrying out their business during the
augmentation in casualties and the spread of dredging Covid-19 pandemic. The PEN program has four
negative impacts, particularly on the economy. principles in its implementation, namely not causing
moral hazard, priority scale, risk sharing, and good
As a basis for handling the humanitarian and governance.
economic crisis, the Government established a legal
umbrella to take extraordinary steps in handling Furthermore, the Act 2/2020 also stipulates policies
Covid-19, namely Act Number 2 of 2020 concerning in order to maintain financial system stability in the
Stipulation of Government Regulations in Lieu of Act face of the threat of an economic or financial crisis
Number 1 of 2020 concerning State Financial Policy amid the Covid-19 pandemic. Policies for maintaining
and Financial System Stability for the Mitigation the financial system stability include providing a support
Corona Virus Disease 2019 (Covid-19) Pandemic and/ scheme in exercising the authority of the KSSK in
or in the Context of Facing Threats Endangering the addressing problems of financial system stability.
National Economy and/or Financial System Stability
(Act 2/2020).
OJK Policy:
1. Market stabilization to
maintain market sentiment
2. Massive and effective policy
communication
Investor Outflow
(Bank, NBFI,
Financial Sector
Debtor Default CKPN
(Banking, Capital Market, NBFI) Liquidity Capital
Market)
> Response to The Impact of Covid-19
OJK Policy: Financial Services Sector Condition Government Policy:
1. Loan Restructurisation
2. Additional Working Capital
CAPITAL LIQUIDITY Placement of Government
Funds in Commercial Banks
Loan
Supporting the National Economic Recovery Program Bank Indonesia Policy:
Government Policy:
Interest Subsidy, Credit 1. Liquidity Scheme
• Interest Subsidy 2. Quantitative Easing
Guarantee • MSMEs and Corporate Credit Guarantee
• Placement of Government Funds in Banking Sector
10 2021-2025 The Indonesian Financial Services Sector Master PlanCondition of
The Financial Services
Sector
OJK Coincidence Index
The national FSS still shows maintained stability in a normal area. The OJK Coincidence Index also
and growth with improved efficiency and increased accrued and touched the threshold at the beginning
financial inclusion over the last five years, amidst of the Covid-19 pandemic entering Indonesia.
slowing global economic growth and stagnant
national economic growth. Financial system stability The national FSS market condition is still very
is maintained as reflected in the OJK Coincidence segmented. The Banking sector dominates the
Index indicator which is below the threshold. financial market on the basis of short-term sources
Although the OJK Coincidence Index experienced of funds. Meanwhile, although the Capital Market
slight upturn in the second semester of 2015 and continues to grow, it is still not optimal for long-term
the first semester of 2018 due to optimized volatility financing. NBFI is still relatively small although it
in the rupiah exchange rate, it is still maintained keeps growing.
OJK Coincidence Index
100 100
80 80
60 60
40 40
20 20
0 0
Dec 14
Feb 15
Apr 15
Jun 15
Aug 15
Oct 15
Dec 15
Feb 16
Apr 16
Jun 16
Aug 16
Oct 16
Dec 16
Feb 17
Apr 17
Jun 17
Aug 17
Oct 17
Dec 17
Feb 18
Apr 18
Jun 18
Aug 18
Oct 18
Dec 18
Feb 19
Apr 19
Jun 19
Aug 19
Oct 19
Dec 19
05/12/14
05/03/15
05/06/15
05/09/15
05/12/15
05/03/16
05/06/16
05/09/16
05/12/16
05/03/17
05/06/17
05/09/17
05/12/17
05/03/18
05/06/18
05/09/18
05/12/18
05/03/19
05/06/19
05/09/19
05/12/19
Exchange Rate Market Bond Market Financial Services Institutions
OJK Coincidence Index Threshold Monthly Average
Capital Market Financial Services Threshold
Institutions
Indonesia’s Financial Services Sector Structure
IDR804 T IDR727 T
IDR527 T
IDR2,558 T IDR2,473 T
IDR527 T
> Condition of The Financial Services Sector
IDR1,923 T
IDR8,713 T IDR8,817 T
2015 2019 Q2-2020
Banking Assets NBFI Assets Investment Manager’s Assets Under Management
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS 11Snapshot of The Development of Indonesia’s Financial
Services Sector for 2015-2019 and Quarter 2 of 2020
BANKING NBFI
Insurance, Pension Fund, Financing
CAPITAL
Companies, dan other NBFI
24.02%
NBFI ASSET
MARKET 54.57%
TPF
2015 2019 2015 2019
IDR4,836.76 T IDR5,998.65 T IDR1,654.74 T IDR2,557.78 T
Q2-2020 Q2-2020
IDR6,260.46 T 37.15% IDR2,472.86 T
JCI
2015 2019
IDR4,593.01 IDR6,299.54
Q2-2020
IDR4,905.4
INSURANCE
38.89% 65.15%
CREDIT
ASSETS
2015 2019 2015 2019
IDR4,092.10 T IDR5,683.76 T IDR830.23 T IDR1,371.20 T
Q2-2020 Q2-2020
IDR5,617.71 T 99.37% IDR1,325.78 T
FUND NAV
MUTUAL
2015 2019
IDR271.97 T IDR542.24 T
INSURANCE RBC
Q2-2020 2015
PAJ: 535.00%
2019
PAJ: 789.37%
IDR482.58 T
2.01% 254.37%
CAR
PAU: 283.00% PAU: 345.35%
2015 2019
21.39% 23.40% 62.35%
Q2-2020
CORPORATE BONDS
Q2-2020
78.16%
OUTSTANDING
22.50% PAU: 688.00% PAU: 319.35%
2015 2019
IDR249.88 T IDR445.20 T
Q2-2020 ACCOUNTS RECEIVABLE
IDR429.71 T
1.69% 24.49% FINANCING
LDR
2015 2019
2015 2019
IDR363.27 T IDR452.22 T
91.95% 93.64%
Q2-2020 Q2-2020
IDR413.20 T
88.64% 185.71%
NEW ISSUERS
NUMBER OF
2015 2019
21 60
Q2-2020
GEARING RATIO
25
38.74% 0.90 times
ASSET
2015 2019
2015 2019 3.59 times 2.61 times
IDR5,919.39 T IDR8,212.58 T
Q2-2020
Q2-2020
ISSUANCE VALUE
2.48 times
IDR8,313.96 T 42.81%
2015 2019
> Condition of The Financial Services Sector
IDR116.83 T IDR166.85 T
Q2-2020
PENSION FUND
NPL (GROSS)
0.04% IDR42.92 T
41.17%
ASSET
2015 2019 2015 2019
2.49% 2.53% IDR206.59 T IDR291.65 T
Q2-2020 Q2-2020
3.15% IDR288.70 T
12 2021-2025 The Indonesian Financial Services Sector Master PlanSubsequent Events of
Financial Services Sector Conditions
Banking Sector
The resilience of the FSS, particularly Banking, is still in sound and controlled condition, demonstrated by
adequate capital and liquidity as well as a maintained risk profile.
CAR NPL
23.74%
23.50% NPL Gross NPL Net 3.22% 3.15%
3.5%
23.00%
3.0%
22.50% 2.5%
22.00% 2.0%
21.50% 1.5%
1.0%
21.00% 21.63% 1.17%
0.5% 1.03%
20.50% 0.0%
Jan 20
Feb 20
Mar 20
Apr 20
May 20
Jun 20
Jul 20
Aug 20
Sep 20
Oct 20
Jan 20
Feb 20
Mar 20
Apr 20
May 20
Jun 20
Jul 20
Aug 20
Sep 20
Oct 20
The capital adequacy ratio is still maintained at a Banking credit risk was maintained at a manageable
fairly high level at 23.74% (October 2020), although level as of October 2020 at 3.15% (gross NPL) and
in March 2020 it had dropped to 21.63%. 1.03% (nett NPL) and indicating an improvement
position from July 2020 for gross NPL (3.22%) and
May 2020 for net NPL (1.17%).
TPF Growth (yoy) Liquidity
Giro Savings Deposit Total TPF AL/NCD (LHS) LA/TPF threshold=10%
25% AL/DPK (RHS) LA/NCD threshold=50%
200% 40%
21.16% 180% 35%
20%
160% 30%
15% 12.12% 140% 25%
11.41% 120% 20%
10%
100% 15%
7.84%
5% 80% 10%
60% 5%
0% 40% 0%
Jan 20
Feb 20
Mar 20
Apr 20
May 20
Jun 20
Jul 20
Aug 20
Sep 20
Oct 20
Jan 20
Feb 20
Mar 20
Apr 20
May 20
Jun 20
Jul 20
Aug 20
Sep 20
Oct 20
-5%
Strengthening liquidity conditions due to high Bank liquidity was adequate with an increasing trend
growth in bank deposits amid a credit slowdown. and ample. As of October 26, 2020, the LA/NCD and
DPK growth since August has reached double digits, LA/TPF ratios were monitored at the 153.98% and
continuing in October 2020 to grow 12.12% yoy, 32.96% levels, well above the threshold.
in line with the placement of Government funds in
banks.
> Condition of The Financial Services Sector
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS 13Subsequent Events of
Financial Services Sector Conditions
Capital Market
The condition of the Capital Market sector has gradually improved after passing through several lows,
including:
Jakarta Composite Index NAV for Mutual Fund Non-Resident Net Buy/Sell
IDR Trillion
Net Buy/Sell SBN Net Buy/Sell Share
IDR Trillion
100
600
5,128.2 50
500 21.80
BUY
400 0
465
SELL
300 (3.71)
(50)
(15.59)
200
(121.26)
100 (100)
3,937.6 (5.59)
(150)
Jan 20
Feb 20
Mar 20
Apr 20
May 20
Jun 20
Jul 20
Aug 20
Sep 20
Oct 20
Jan 20
Feb 20
Mar 20
Apr 20
May 20
Jun 20
Jul 20
Aug 20
Sep 20
Oct 20
Jan 20
Feb 20
Mar 20
Apr 20
May 20
Jun 20
Jul 20
Aug 20
Sep 20
Oct 20
The stock market was well maintained and The increase in the JCI also boosted Mutual In line with the entry of non-resident investors to
the JCI strengthened on October 30, 2020 Fund performance. In the period of October other emerging markets, non-resident investors
it closed at 5,128.2 levels, although it had 2020, the Net Asset Value (NAV) was present began to take action on the SBN Market, which
touched its lowest point on March 24, 2020 at the level of IDR529 trillion, previously the in October recorded a net buy of IDR21.8 Trillion
(3,937.6). NAV of Mutual Funds had reached the lowest (March position was the largest net sell at
point of IDR465 Trillion. IDR121.26 Trillion). The strengthening of the SBN
market was supported by increased participation
of the Banking sector in the SBN market.
NBFI
The change in the value of the NBFIs assets as a result of weakening yields of financial instruments and
progressing toward the year end.
NPF Insurance RBC Gearing Ratio
4,7% Life Insurance General Insurance
5.6% 489%
2.73x 2.28x
304%
Jan 20
Feb 20
Mar 20
Apr 20
May 20
Jun 20
Jul 20
Aug 20
Sep 20
Oct 20
Jan 20
Feb 20
Mar 20
Apr 20
May 20
Jun 20
Jul 20
Aug 20
Sep 20
Oct 20
Jan 20
Feb 20
Mar 20
Apr 20
May 20
Jun 20
Jul 20
Aug 20
Sep 20
Oct 20
> Condition of The Financial Services Sector
The risk profile of finance The insurance industry's capital is
companies is maintained at a maintained stable at an adequate
manageable level with an NPF ratio level, Risk-Based Capital (RBC) of the Gearing Ratio is also in trend
of 4.7% for the position in October life and general insurance industry decreased at 2.28 times
2020 or has decreased from the is 538.8% and 337.2%, respectively, (October 2020).
July position which reached the well above the regulatory threshold
highest point of 5.6%. of 120%.
14 2021-2025 The Indonesian Financial Services Sector Master PlanMicro Finance Institution, Other Specialized
Financial Services Institutions and
Peer-to-Peer Lending Fintech Development
Micro Finance Other Specialized Financial
Institution Services Institutions
Since the enactment of Act OJK also supervises a variety of other
Number 1 of 2013 concerning specialized FSIs, which include guarantee
Micro Financial Institutions, the number companies, pawnbrokers, Permodalan
of microfinance institutions that have obtained Nasional Madani (PNM), Indonesian Export
permits from OJK has been increasing every year. Financing Institution (Lembaga Pembiayaan Ekspor
The assets of microfinance institutions also continue Indonesia or LPEI/Eximbank), Sarana Multi Finance
to experience an increasing trend. As of October (SMF), and Danareksa. As of October 2020, there
2020, there were 223 MFIs with total assets of were 116 other specialized financial service
IDR1.13 Trillion. institutions with total assets reaching IDR252.74
Trillion.
Number of Microfinance Number of Companies and Asset
Institution Entities and Total Development of Other Specialized
Assets Financial Services Institutions
IDR Billion
Rp Trillion
1,200 223 223 250
221 300 140
204 117 117 116
1,000 109
183 200 120
180 250
800 100
129 150 150
600 80
44
100 100
400 60
22 26
50 50
200 20
20
0 0 0 0
2015 2016 2017 2018 2019 Q2-2020 Q3-2020 Oct-2020 2015 2016 2017 2018 2019 Sep-20 Oct-20
Assets Number of MFIs (rhs) Assets Number of Companies
Peer-to-Peer Lending Fintech
As of October 2020, there were 119 registered Peer-to-Peer Lending Fintech operators
and 36 licensed (a total of 155: 144 conventional and 11 sharia; 102 local and 53 foreign
investments). The total assets of Peer-to-Peer Lending Fintech operators reached
IDR3.42 Trillion.
Asset Growth of Fintech Peer to Peer Growth in the Number of Fintech Peer to
Lending Peer Lending Accounts of Lenders and
4.000 80 Borrowers
3,500 70
> Condition of The Financial Services Sector
50
3,000 60
IDR Billion
IDR Billion
2,500 50 40
2,000 40
30
1,500 30
Million
1,000 20 20
500 10
10
- -
Dec-18
Feb-19
Apr-19
Jun-19
Aug-19
Oct-19
Dec-19
Feb-20
Apr-20
Jun-20
Aug-20
Oct-20
-
2017 2018 2019 Sep-20 Oct-20
Conventional Sharia (rhs) Accumulated Accounts of Lender Accumulated Accounts of Borrowers
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS 15Financial Conglomerates and Digital Financial
Innovation Development
Financial Conglomerates
As of Quarter 2 of 2020, the total assets of the Financial Conglomerates (FCs) reached
IDR7,486 T or 63.6% of the total assets of the FSS. This shows the significant influence
of the Financial Conglomerates on the FSS in Indonesia. Of the total assets, the financial
conglomerates were dominated by Banking as the lead entity at 95.70%.
Trend of FCs Assets and Share Financial Conglomerate with
towards FSS (SJK) Assets >IDR100 Trillion Assets
IDR Trillion IDR Trillion
Group BRI 1,404.9
14,000 72%
Group Mandiri 1,375.4
70.4% 70%
12,000 Group BCA 983.8
10,000 68% Group BNI 886.5
66.2% 66.2% 66.7% Group MUFG (d/h Group Danamon) 372.4
8,000 65.7% 66%
Group CIMB Niaga 277.4
6,000 62.6% 64%
62.9% Group Panin 225.5
4,000 62% Group Bangkok Bank 193.8
Group OCBC 189.5
2,000 60%
Group Maybank 167.1
0 58% Group Astra 120.7
Dec 2015 Dec 2016 Dec 2017 Jun 2018 Dec 2018 Jun 2019 Dec 2019 Jun 2020
Group Mega 117.3
FC Asset FC Asset FC Asset Group UOB
111.7
Group HSBC
109.4
The Development of Digital
Financial Innovation
As of Quarter 3 of 2020, OJK recorded a number of 89 DFI Cluster
Digital Financial Innovation (DFI) companies which are
35
classified into 16 clusters. Aggregator
36
Financing Agent 5
7
Credit Scoring 13
13
Number of Registered DFI Financial Planner 7
7
Operators at OJK 1
Claim Service Handling
2
100 88 86 89
Project Financing 5
90 5
80
71 1
Blockchain-based
70 1
60 1 Q2-2020
45 Funding Agent
86
50
1
40 31 31 Online Distress Solution
1 Total
1
30
Property Investment Management 2
20
2
> Condition of The Financial Services Sector
10 Q3-2020
89
Verification Non-CDD 4
0 5
Q1-2019 Q2-2019 Q3-2019 Q4-2019 Q1-2020 Q2-2020 Q3-2020 3
Total
Tax & Accounting
3
E-KYC 4
3
RegTech
1
1
InsurTech 2
1
Insurance Broker Marketplace 1
1
-
Online Gold Depository
-
-
Social Network & Robo Advisor
-
16 2021-2025 The Indonesian Financial Services Sector Master PlanLevel of Financial Literacy and Inclusion
The level of financial literacy and inclusion has continued Improved Financial Literacy and Inclusion
to move positively over the past five years. Based on the 80,00%
70,00%
results of the National Financial Literacy Survey conducted 60,00%
by OJK in 2019, the financial inclusion index reached 50,00%
40,00%
76.19% and the financial literacy index reached 38.03%.
29,70%
38,03%
67,80%
76,19%
30,00%
2016
This augmentation was the result of the implementation 20,00%
2019
10,00%
of 3 National Strategic Initiative programs for Indonesian 0,00%
Financial Literacy (Revisit 2017). Financial Literacy Financial Inclusion
Aceh
East Kalimantan
Distribution of 6
North Sumatera North Kalimantan 23
Financial Literacy 14
Riau
Riau Islands
West Kalimantan
Central Sulawesi
North Sulawesi
North Maluku
and Inclusion in
15
7 5 12
27 South Sumatera 9 30
West Sumatera Gorontalo
Indonesia 19 West Papua
Bangka Belitung
Jambi 24 10 33
17 Maluku
8 22 21 25 West Sulawesi 20
32
Inclusion 2016 Bengkulu 28 Central Kalimantan 18
Southeast Sulawesi
Lampung 31 DKI Jakarta South Kalimantan 29
Inclusion 2019 1 East Java South Sulawesi
Banten 11 3 Papua
16
Literacy 2016 West Java
4
2
East Nusa Tenggara
13 26 34
DI Yogyakarta
Literacy 2019 Central Java
Bali
West Nusa Tenggara
59.16%
93.98%
94.76%
58.53%
92.91%
92.39%
92.13%
88.48%
87.96%
86.91%
86.39%
86.09%
85.56%
85.08%
84.51%
84.29%
83.99%
76.19%
48.95%
47.38%
76.12%
75.85%
45.67%
44.36%
43.19%
40.05%
38.03%
39.63%
39.63%
39.27%
38.85%
38.06%
37.96%
37.53%
37.43%
37.01%
67.8%
78.2%
75.6%
76.0%
74.9%
74.5%
71.4%
73.2%
68.0%
69.5%
73.1%
67.3%
72.4%
65.1%
69.5%
68.4%
76.7%
64.0%
29.7%
31.3%
30.5%
22.5%
38.2%
28.7%
37.5%
31.3%
27.3%
33.0%
26.2%
40.0%
38.5%
35.6%
33.5%
37.1%
32.7%
29.5%
National 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17
76.19%
75.33%
75.07%
74.80%
74.54%
64.57%
61.94%
66.75%
65.71%
64.83%
65.62%
65.09%
62.99%
62.73%
60.89%
60.89%
60.63%
38.03%
59.84%
36.75%
36.48%
36.48%
36.22%
35.70%
35.43%
34.65%
35.17%
34.91%
34.55%
34.12%
32.46%
31.23%
26.9% 30.97%
22.2% 29.13%
19.3% 28.87%
28.0% 27.82%
67.8%
65.5%
66.9%
60.4%
59.3%
66.9%
66.2%
64.0%
61.5%
66.9%
69.1%
65.5%
63.3%
69.8%
62.5%
61.5%
62.2%
58.5%
29.7%
26.9%
21.5%
27.3%
27.6%
28.4%
23.3%
26.5%
30.5%
26.2%
23.3%
29.5%
26.5%
26.9%
National 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34
By gender, the literacy index and financial inclusion The sharia financial literacy index also upsurged from
improved equally for men and women. 8.1% in 2016 to 8.93% in 2019, although it is still below
the rise in conventional financial literacy.
Level of Financial Literacy and Inclusion Financial Literacy and Inclusion Based on
Gender
CONVENTIONAL SHARIA
LITERACY INCLUSION LUSI
ON INCLUSION 9.10%
LITERACY INCLUSION
IN
C 29.5% 2019
> Condition of The Financial Services Sector
2019 2019
2016
11.1%
2016
37.72%
39.94% 77.24% 36.13% 75.15% 2019
Y
AC
6.74% 7.64% 0.63% 8.95%
ER
LI T LITERACY
33.2% 69.6% 25.5% 66.2% 65.6% 8.1%
75.28% 2016
8.93% 2016
2016 2016 2019
2019
LITERACY 8.22% LITERACY 0.83%
INCLUSION 9.68% INCLUSION (2%)
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS 17Challenges Ahead
Short-Term Challenges
N
PE
al
on
sia
i Na
om
on
Ek
m
gra
Pro
1 2 3 4
Economic Mid and long- Financial market Stimulus policy
uncertainties term financing condition still has continuity to
due to Covid-19 support for the potential to reinforce
pandemic affecting National be exposed to the National
the demand Economy high volatility Economy
recovery and public Recovery influenced by Recovery and
purchasing power Program. the sentiment of normalization
strength as well as market players. phase.
goods and services
production and
distribution.
> Challenges Ahead
18 2021-2025 The Indonesian Financial Services Sector Master PlanStructural Challenges
Global and Domestic Economic Financial Literacy and Inclusion Gap
Uncertainty
• Increases downside risk to the • The raise in the financial
national financial economic inclusion index has
system not been followed by a
• Relatively low competitiveness balanced increase in the
with small capital and financial literacy index
economies of scale compare to • The need for equitable
ASEAN distribution of financial
• More complex FSS risks literacy and inclusion,
and regulatory arbitrage especially towards
practices due to regulatory and priority targets
supervisory gaps • Rampant illegal
investment
Digital Economy Revolution
The Need for Improved
Effective FSS Supervision
A supervisory approach that must be complemented
by quick access to most recent data, analyze data
precisely and accurately
Disruption of FSS Shortage of high
business patterns and quality talent in digital
consumer behaviors era Limited capacity and
expertise of OJK
human resources to
supervise, including
the application of
information technology-
based supervision
The importance of
The role of regulation to
appropriate
encourage responsible
research-based
innovation
approaches and
policies
The Need for Financing The National Economy
Investment Financing for Limited The efficiency The development The financial Changing
of the sharia market is still
needs to MSMEs is still sustainable level of the financial relatively shallow
needs of
support limited finance national FSS industry is still with limited consumers
economic instruments is not optimal medium and long who are
> Challenges Ahead
growth not yet (8.87% of the term financing looking for a
including its
throughout total instruments one stop shop
incentives competitive
2020-2024 assets of the FSS for financial
as of September products
2019)
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS 192021-2025 Indonesian Financial
TO RECOVER NATIONAL ECONOMY AND REINFORCE FINANCIAL SERVICES SECTOR
2020-2021 Short-Term Policy Direction
Financial Services Sector Supports for National Economy
Recovery Program
1
To Accelerate Implementation of The
Government’s National Economic Recovery
Program (PEN)
Through funding support for businesses
that are labor intensive and/or have high
Monitor and Evaluate
multiplier effect for the economy
The Stimulus Policy and
Normalization Transition of
The Prudential Relaxation
2
Policy
Continue the relaxation
implementation of loan/
financing restructuring policy
Current Crisis
in a selective manner to
Response
prevent moral hazard
3
Increase Consumer Demand,
MSMEs Development and Job
Creation
• Support Government-initiated
programs to reinforce demand
creation and employment
creation
• Accelerate economic driving
4
wheels at the regional level to
Accelerating The
improve economic activities
Development of an
Integrated Digital
Economic and Financial
Ecosystem
Reinforce digitalization
among MSMEs, Micro
Waqf, and so on and
put forward IT-based
supervision
5
Reformation of NBFI
and Capital Market
Acceleration to
Maintain Financial
Market Integrity
20 2021-2025 The Indonesian Financial Services Sector Master PlanServices Sector Master Plan
RESILIENCE AND COMPETITIVENESS
2021-2025 Structural Framework
Enhancing Financial Services Sector Resilience and Competitiveness
The 2021-2025 MPSJKI
STRENGTHENING DEVELOPMENT OF DIGITAL
RESILIENCE AND FINANCIAL SERVICES TRANSFORMATION
COMPETITIVENESS SECTOR ECOSYSTEM ACCELERATION
Strengthening capital Increasing the role of the Support FSS digital
and accelerating FSS in supporting priority transformation innovation
economic sectors, MSMEs, and acceleration
consolidation of FSI
job creation and regional
development Developing regulatory
Strengthening framework which supports
governance, risk
Structural
Establish FSS integration digital financial sector
Response
management and to add value of Sharia ecosystem
market conduct Finance in the development
of halal industry and sharia Improving human capital
economic ecosystem capacity in the financial
Synchronize FSS services sector in line with
regulations and Expand the financial access the development of the digital
supervision by referring and foster public financial industry
to the best practices literacy
and/or international Strengthening the role
Strengthening consumer of research to support
standards
protection in the FSS FSS digital innovation and
transformation
Strengthening Accelerating financial
Integrated Supervision market deepening Accelerate the implementation
of Financial of IT-based supervision
Conglomerates and Supporting FSI business (Suptech) in OJK and use of
expansion to carry out multi- Regtech by FSS
Cross Cutting Issues
activities business
Perform Business Process
Increase the role of financial Reengineering to increase the
services in the sustainable quality of licensing, regulation
finance to achieve the SDGs and supervision
COLLABORATION AND COOPERATION AMONG STAKEHOLDERS (ENABLER)
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS 21The Indonesian Financial
Services Sector Master
Plan 2021-2025
The FSS should be developed with the goal to make To face these challenges, the national FSS must
it highly competitive, able to play an optimal role be developed so that it is highly resilient to various
in the national economy, and able to face various shocks, competitive and adaptive to an ever-changing
challenges amid the dynamics of the national and environment, efficient and contributes optimally
global economy. As described above, the challenges towards economic development, and able to provide
are divided into 2 (two) categories, namely short- consumer-oriented financial products and services.
term and structural longer term challenges that
may come from domestic or globally. In the Short- MPSJKI 2021-2025 is aimed to recover national
Term, economic conditions and the FSS as a result economy as well as improving resilience and
of the Covid-19 pandemic; speed of discovery and competitiveness of the financial services sector
distribution of the Covid-19 vaccine; Government through innovation and digitization, as well as
policy response for health management and preparing National FSS in facing regional and global
implementation of the National Economic Recovery competition. The structure of the MPSJKI consists of:
programs (PEN) and the impact of the Large-Scale
Social Restrictions (Pembatasan sosial Berskala a. Short-term FSS Policy Direction (2020-2021) -
Besar or PSBB) need to be considered. Meanwhile, Financial Services Sector Support for the National
in the medium term from the domestic side, the FSS Economic Recovery Program (PEN).
is still very segmented with a large number and
relatively low capital capacity as well improvemenet b. Structural Framework 2021-2025: Enhancing
in governance and risk management. Cross- Resilience and Competitiveness of the Financial
sectoral regulation and supervision still also needs Services Sector.
to be harmonized. Globally, the FSS faces rapid 1. Strengthening Resilience and Competitiveness.
development of the digital economy along with the 2. Financial Services Ecosystem Development.
changes in consumer behaviors, relatively large 3. Digital Transformation Acceleration.
national development financing needs, and high
volatility in global financial markets.
> The Indonesian Financial Services Sector Master Plan 2021-2025
22 2021-2025 The Indonesian Financial Services Sector Master PlanShort-Term Financial Services Sector Policy Direction
(2020-2021) - Financial Services Sector Support for
the National Economic Recovery Program (PEN)
The pandemic which is still overshadowing the short-term outlook increases the urgency of formulating short-
term strategies to accelerate national economic recovery (PEN).
1. To accelerate implementation of the PEN Furthermore, OJK will continue to periodically
One of the biggest challenges faced by many monitor the industry and try to find solutions to
policymakers to respond to the impact of Covid-19 the problems that arise in the field that are often
pendemic is in terms of the speed and accuracy of reported through OJK Call Center Contact 157 and
beneficiaries. This also occurs in the formulation Regional Office/OJK Office (KR/KOJK). In addition,
and implementation of stimulus policies at the if necessary, OJK will also issue supporting
FSS. Therefore, the support and cooperation of all regulations for the implementation of the PEN
parties, both from the policy makers and the policy programs, i.e if there will be new policies/programs
intermediaries, is very important. issued by the Government in the future.
To accelerate implementation of Government 2. Monitoring and evaluation of the stimulus
stimulus, OJK supports Government programs policies and the transition to normalization of
in PEN and optimizes the role of the FSS both in the prudential relaxation policies
keeping the economy rolling through financing
support for labor-intensive businesses or those During the implementation period of the stimulus
with a larger multiplier effect on the economy. policy, OJK actively monitors and evaluates the
OJK has issued various stimulus policies implementation of these policies in order to
during the Covid-19 pandemic in line with ensure the smooth running of the program and
the Government's efforts to promote national provide input and policy improvements. Looking
economic recovery. forward, monitoring will continue to be carried out
proactively and evaluation of stimulus policies will
also be carried out as one of the considerations for
further policy formulation and policy normalization.
THE NATIONAL ECONOMIC RECOVERY (PEN) PROGRAM WILL CONTINUE IN 2021
In order to maintain the momentum of economic recovery
IDR25.40T IDR48.80T IDR110.20T
1. Cash Transfer Program (Program Keluarga
1. Procurement of Covid-19 1. Interest Subsidy for People’s Harapan) for 10 Million Beneficiary Families
> The Indonesian Financial Services Sector Master Plan 2021-2025
PROTECTION
Vaccine Business Loan (KUR) 2. Food Stamps Programs (Kartu Sembako) for
HEALTH
SOCIAL
19.8 Million Beneficiary Families
2. Immunization, Infrastructure,
MSME
2. Financing Support for Cooperatives 3. Training Incentive Program (Kartu Pra-Kerja)
Lab, R&D and MSMEs 4. Village Direct Cash Assistance (Bantuan
3. BPJS Contribution Assistance 3. Placement of Funds in Bank Langsung Tunai) and Supporting Village
IDR356.5T
Reserve for Non-Wage Workers 4. Loss Limit Guarantee State-Owned Enterprises (BUMDes)
5. Cash Social Transfer for 10 Million Beneficiary
(PBPU) and Non-Workers (BP) 5. PEN Financing Reserve Families @IDR200 Thousand for 6 Months
IDR14.90T IDR20.40T IDR136,70T
1. Tourism Support
SEKTORAL KL/
1. Government Equity Participation
PEMBIAYAAN
KORPORASI
2. Food Security
(PMN) to Indonesia Eximbank (LPEI)
INSENTIF
1. Tax Borne by The Government
USAHA
PEMDA
3. ICT Development
2. Government Equity Participation 2. Exemption of Income Tax Art. 22
4. Loans to The Regions
to SOEs in Assignments (HK, ITDC, on Import
5. Labor Intensive Programs
Pelindo III, KIW) 3. Early VAT Refund
6. Industrial Zones
3. Guarantee of Backstop Loss Limit 7. PEN Expenditure Reserves
Source: Ministry of Finance, August 2020.
https://www.kemenkeu.go.id/publikasi/berita/6-arah-kelanjutan-pen-dalam-rapbn-2021/
TO RECOVER THE NATIONAL ECONOMY AND ENHANCE THE FINANCIAL SERVICES SECTOR RESILIENCY AND COMPETITIVENESS 23OJK also proactively monitors and coordinates 4. Accelerating the development of an
not only at the central level, but also at the integrated digital economic and financial
regional level through the regional offices or ecosystem
OJK offices. This effort is made to accelerate the
identification process as well as to overcome the Along with changes in consumer lifestyles and
various constraints specific to certain regions. OJK needs which prioritize non-physical/digital
believes that a gradual and sustainable economic services, in addition by the new normal during
recovery in the regions will in turn support a more the Covid-19 pandemic which has limited human
solid and faster national economic recovery. physical activities, further emphasizes the urgency
to accelerate the transformation and digital
After the evaluation of policy implementation and economic and financial ecosystem.
taking into account developments in the pandemic
and the national economy, in the short-term, OJK Improving services through digital channels is
will continue to implement relaxation to the credit/ one of the development focuses carried out by
financing restructuring policy as a precautionary several industries that are ready to adapt to
measure to support the decline in the quality of consumer needs. As a regulator, OJK supports
restructuring debtors due to Covid-19 pandemic the acceleration of the transformation and
conditions. Restructuring extensions are given development of the digital ecosystem in the FSS
selectively based on the assessment of FSIs to through accommodative policies.
avoid moral hazard.
Several policies in the Banking sector that will
Furthermore, to ensure the sustainability of the be taken in to account in the Short-Term are the
stable and sound FSS business, the industry is Digital Banking Transformation Blueprint, the
directed to continue to look into the adequacy implementation of digitalization for all Sharia
of Allowance for Impairment Losses (Cadangan Banking business groups as well as provisions
Kerugian Penurunan Nilai or CKPN) in anticipation related to Banking synergy under single ownership
of deteriorating credit quality. for the development of Islamic Banking and
providing incentives in fulfilling the required
The industry must consider this aspect in documents through optimizing the integrated role
managing capital stock according to the risk of the governance committee.
profile, including in determining the dividend/
bonus to the shareholders. In the Capital Market, to support digital
transformation, OJK continues to encourage
3. Increase consumer demand, MSMEs the opening of wider access to MSMEs through
development and job creation equity/securities crowdfunding and opening
access to finance by increasing the offering
As previously discussed, pandemic management portion to the public through the e-IPO system.
policies have a direct impact on the economic In addition, the implementation of the General
downturn, especially from the demand side. Meeting of Shareholders electronically will also be
Weak demand during a pandemic is an issue that continued. In the NBFI sector, OJK will encourage
requires policy intervention. In this case, OJK the digitization of Micro Waqf Banks and prepare
will always support programs initiated by the regulation framework in relations to digital
Government in order to support demand creation, insurance and reinsurance brokerage services.
> The Indonesian Financial Services Sector Master Plan 2021-2025
MSME development and job creation through
coordination; business link and match; and moral To accelerate licensing requirements, OJK
suasion with FSIs. continues to carry out Business Process
Reengineering of the licensing processes that are
In addition, OJK will accelerate the economic running at OJK, both in terms of simplification
growth in the regions in order to support economic of business processes and improvements of the
activity, including by facilitating the acceleration of information technology.
absorption of Government spending (State Budget/
Regional Budget). a. In terms of simplification of business
processes, analysis and mapping of types of
licensing in all sectors (Banking, Capital Market
and NBFIs) is carried out, which will then be
simplified to achieve optimal SLA.
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