OJK Launches Roadmap For Indonesian Sharia Banking Development And Strengthening 2023-2027

Chief Executive of Banking Supervision of the Financial Services Authority (OJK), Dian Ediana Rae. (Photo: Doc. Antara)

JAKARTA - The Financial Services Authority (OJK) has officially launched the Roadmap for the Development and Strengthening of Indonesian Sharia Banking (RP3SI) 2023-2027 with the theme Excellent Sharia Bank for Prosperous Communities" on November 27, 2023.

As a kinisan dari Roadmap Pembangunan Perbankan Syariah Indonesia (RP2SI) 2020-2025, RP3SI diharapkan dapat menjadi pandik bagi OJK, asosiasi, industri perbankan Syariah serta seluruh stakeholder terkait dalam menyusun strategi pengembangan dan penguatan perbankan syariah dalam lima tahun ke depan.

This roadmap is proof of OJK's commitment to support the development of national sharia banking as mandated in Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (UP on PPSK).

The transformation of Islamic banking is the main focus to bring this industry to stronger and more competitive Islamic banking, and contribute significantly to the national economy and social development.

Meanwhile, this transformation requires a change in the paradigm of all stakeholders towards strengthening the characteristics of Islamic banking, which not only prioritizes business goals, but also supports its social function to achieve the benefit of the community so that it is hoped that Islamic banking can play a significant role in promoting moral economy.

RP3SI brings a vision to realize healthy, efficient, with integrity, and competitive Islamic banking, and contribute significantly to the national economy to achieve the benefit of the community.

In order to achieve this goal, RP3SI is summarized in 5 (five) main focuses covering three dimensions, namely supply side, demand side, and internal OJK as the main support for all aspects of Islamic banking. The five pillars in question are:

- Strengthening Sharia Banking Industry Structure and Resilience - Acceleration of Sharia Banking Digitization- Strengthening Sharia Banking Characteristics- Improvement of Sharia Banking Contributions in the National Economy- Strengthening Regulation, Licensing, and Supervision of Sharia Banking

So that RP3SI can run optimally, supporting factors (enabler) are needed, namely leadership and management of change and collaboration with stakeholders.

By involving all internal and external parties, it is hoped that the national sharia banking industry will continue to grow and become stronger.

If all aspects and components of the RP3SI are implemented holistically and collaboratively, national sharia banking will further develop, become a strong economic force, and provide tangible benefits for the benefit of all Indonesian people.

The Chief Executive of Banking Supervision of the Financial Services Authority (OJK), Dian Ediana Rae assessed that the current Islamic banking market structure is still relatively small and not ideally because of the total operating Islamic banking, it is only dominated by one Islamic commercial bank.

"The national Islamic banking industry is still relatively small on a business scale. So it is not yet competitive in the national banking industry," he explained at the Launch of the Roadmap for Sharia Banking Development and Strengthening 2023-2027, Monday, November 27, 2023.

Dian said the Islamic banking industry currently shows that it is still on a small business scale where there are three Islamic banks and one UUS is still in the asset class between IDR 20 trillion to IDR 40 trillion. Meanwhile, 8 Islamic banks and 16 UUS have assets below IDR 20 trillion.

"And there is only one Islamic commercial bank that has assets above Rp 100 trillion. We consider that this market structure is not ideal because it is only dominated by one large Islamic commercial bank," he said.

So with that, Dian said that OJK encourages Islamic banks to consolidate so that the Islamic banking industry can have up to three large-scale banks.

"OJK encourages Islamic banks to consolidate, with the hope that the Islamic banking industry can have two or three large-scale banks that are more competitive," he said.