Sharia Capital Market Products Must Be Known Early In Indonesia

Rupiah (Photo: Antara)

JAKARTA - The government is recommended to introduce Islamic capital market products to the public from an early age to boost interest in these products.

"To increase demand, of course, the method is through education. Because literacy rates are very low, so we can enter starting from the elementary school curriculum (SD)," said Head of the Sharia Institute Economic Program for Development of Economics and Finance (Indef) Fauziah Rizki Yuniarti quoting Antara.

He explained that teaching about the Islamic capital market on an elementary school education scale is not necessary with a complicated explanation. Education regarding the Islamic capital market can use styles about stories as in general elementary school level issues.

"The important thing is that they know other financial activities, such as the Islamic capital market. So, they have been introduced since childhood," he said.

Based on data from the National Financial Literacy and Inclusion Survey (SNLIK) conducted by OJK in 2022, capital market literacy has only reached 4.11 percent and Islamic finance 9.14 percent. Meanwhile, the capital market inclusion rate is at the level of 5.19 percent and Islamic finance 12.12 percent.

To increase literacy and inclusion levels, apart from targeting the education sector, Fauziah also advised the government to encourage the endors of the Islamic capital market by generation Z and millennials. This is because the two generations use sukuk products published by the government a lot.

In order to balance these efforts, the government also needs to prepare regulations that are able to protect public investors. The reason is, often complicated regulations become a barrier for investors to invest.

"There are regulations that need to be corrected so that investors want to enter their money into the capital market, especially the Islamic capital market," he said.

On the other hand, the government also needs to secure the demand side by developing sharia capital market products, such as sharia mutual funds. Fauziah also recommends the government to encourage corporate sukuk and regional sukuk which are still hampered by issues of issuance.