Officially Signed By Jokowi, The P2SK Law Is A Momentum For The Reform Of The Indonesian Financial Sector

Illustration (Photo: Doc. Ministry of Finance)

JAKARTA – The Ministry of Finance (MoF) stated that President Joko Widodo had officially signed the Financial Sector Development and Strengthening Bill (P2SK) into Law (UU) Number 4 of 2023 (UU No.4/2023), Thursday, January 12.

It was stated that the government gave its highest appreciation to all members of the People's Representative Council (DPR) who in this case had initiated the process of forming the latest regulation.

The Minister of Finance, Sri Mulyani, said the P2SK Law was clear evidence of advancing public welfare by reforming Indonesia's financial sector.

According to her, an inclusive, deep, and stable financial sector is the main prerequisite for accelerating national economic development.

“This is the momentum for financial sector reform which is increasingly appropriate because of various global challenges. Many things are happening right now, starting from the pandemic, the geopolitical situation, the potential for a recession in various regions, technological developments that have changed the financial services business model, and climate change. Indonesia's financial system stability needs to be strengthened to deal with these various global scenarios", she said in a press statement, Friday, January 13.

Minister of Finance added, this law will replace 17 laws related to the financial sector, which have been in force for quite a long time, even up to 30 years.

“This is done to adapt to the dynamics of changing times. Various indicators show the urgency of reforming the Indonesian financial sector, such as the still shallow financial sector, the not yet optimal role of intermediary in the financial sector, and the low level of consumer protection", she said.

The state treasurer said that the government and regulatory agencies would soon draft implementing regulations, namely in the form of Government Regulations, Bank Indonesia Regulations, OJK Regulations, and LPS Regulations. He promised that all implementing regulations would be drawn up within two years of the promulgation of the P2SK Law.

"The government will always ensure that the process of drafting various implementing regulations is carried out credibly by involving various related parties including the DPR-RI, supervisory authorities, and the public", said Minister of Finance Sri Mulyani.