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Finance
Indonesia’s financial sector has been flourishing over the past half decade. The COVID-19 pandemic period, while being a time of austerity for most sectors, led to revolutionary innovations in Indonesia’s financial services industry, particularly in fintech. From December 2020 to December 2022, total assets of the fintech sector grew by 48.54 percent from 2020 to 2022. This growing trend continued even after the pandemic lockdowns ended, as total assets in fintech grew by 30.8 percent from December 2022 to December 2023.
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Finance
Indonesia’s financial sector has been flourishing over the past half decade. The COVID-19 pandemic period, while being a time of austerity for most sectors, led to revolutionary innovations in Indonesia’s financial services industry, particularly in fintech. From December 2020 to December 2022, total assets of the fintech sector grew by 48.54 percent from 2020 to 2022. This growing trend continued even after the pandemic lockdowns ended, as total assets in fintech grew by 30.8 percent from December 2022 to December 2023.
With fintech paving the way forward, traditional banking followed suit by revolutionizing its services. From 2022 to 2023, the banking industry’s fund distribution increased by 6.28 percent, source of funds increased by 6.33 percent, and total assets in the industry grew by 6.98 percent, reaching a total of US$8.22 trillion. Moreover, even regional banks have been benefitting from this wave of innovation. For the same period from 2022 to 2023, the regional banking sector saw a 7.67 percent in distributed funds, an 8.08 percent increase in source of funds, and a 7.52 percent increase in total assets, reaching a total of US$137.96 billion.
Innovations in Indonesia’s finance sector extend beyond financial services. On September 2023, the Indonesian monetary authority, Bank Indonesia (BI), introduced three pro-market monetary instruments that function as short-term fixed income securities with high coupon rates. The three instruments, SRBI, SUVBI, and SUVBI, were able to collect Rp 409 trillion (US$25.2 billion), US$2.31 billion, and US$387 million, respectively.
Particularly in the case of the SRBI, this instrument represented an innovative way to attract capital flow from abroad during a period of high credit costs and slow investment. Approximately 20.77 percent, or Rp 85.02 trillion (US$ 5.26 billion), of the total outstanding SRBI were owned by non-Indonesian residents, underscoring the SRBI’s success as a monetary instrument.
Even when compared to other countries in the same region, the Indonesian finance sector stands out for its stability against fluctuations. Throughout 2023, the global cost of credit was high due to hawkish Fed policies made to curb US inflation, resulting in a stagnation of capital flow on a global scale. Entering the second quarter of 2024, the composite index of many Southeast Asian countries such as Singapore and Thailand recorded price decreases compared to the same period last year, reaching -3.96 percent and -13.9 percent on the Straits Times Index (STI) and the Bangkok SET index, respectively. Meanwhile, the Jakarta Stock Exchange Composite Index (JKSE) recorded a price increase of 5.18 percent for the same one-year period.
In summary, the Indonesian financial sector stands out for its stability and consistency, maintaining growth through innovation even during periods of austerity or global uncertainty. This consistency is also reflected in its GDP, which grew by 7.4 percent from 2022 to 2023, contributing roughly 4.16 percent to the national GDP in 2023.
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Transactions at the East Java Trade and Investment Mission to Lampung reached nearly Rp 1.06 trillion. East Java Governor Khofifah Indar Parawansa stated that the achievement represents a significant increase compared to the 2023 event, which saw 35 transactions worth a combined Rp 285.52 billion.
"This achievement is the result of synergy and trust between regions in supporting domestic products. This is clear evidence that East Java remains committed to driving national economic growth and our optimism about realizing the strength of the domestic market," she stated officially on Aug. 8, 2025.
The Trade and Investment Mission was held at Swiss-Belhotel Lampung on Aug. 8, 2025. It was attended by East Java Governor Khofifah, Lampung Governor Rahmat Mirzani Djausal, Acting Bank Jatim President Director Arif Suhirman, and Bank Lampung President Director Mahdi Yusuf.
Khofifah also expected that the signing of the agreement between regional development banks (BPDs) PT Bank Pembangunan Daerah Jawa Timur (Bank Jatim) and PT Bank Lampung will further the connection between the two provinces.
"This [collaboration] will certainly strengthen the performance of BPDs in the two provinces, support economic and financial sector growth, as well as serve as a gateway for cooperation between the provinces of East Java and Lampung. The collaboration is in line with regulations set by the Financial Services Authority (OJK)," she elaborated.
Acting Bank Jatim President Director Arif emphasized that the bank continues to support the East Java Provincial Government's programs, including participation in the Trade and Investment Mission, which had "Enhancing Connectivity Networks between East Java and Lampung Provinces" as its theme.
He explained that Bank Jatim remains committed to supporting East Java's micro, small, and medium enterprises (MSMEs) in increasing their competitiveness so they can penetrate national and international markets.
"We are having MSMEs fostered by Bank Jatim participate in this Trade Mission as part of efforts to expand their market share. We are confident that their products will attract visitors and have the potential to create new business opportunities for the entrepreneurs [involved]," Arif added.
The MSMEs in question are Gajah Mada Batik MSME, Majapahit Chocolate MSME, and CYS Fried Onion MSME. He stated that MSMEs ccould gain a strategic platform to introduce their products to potential markets in Lampung through the event. This allows Bank Jatim to provide various banking services to MSME customers as well as actively provide mentoring and support in developing their businesses.
"The superior products of the MSMEs fostered by Bank Jatim are expected to provide benefits according to the needs of Lampung Province's people," he explained.
The signing of the Conditional Share Subscription and Acquisition Agreement between Bank Jatim and Bank Lampung also took place. The signing was conducted by Arif with Bank Lampung President Director Mahdi, and witnessed by the governors of their respective provinces.
"The purpose of this agreement is to regulate the procedures for implementing capital participation and the formation of a bank business group (holding company) between the parties. Bank Lampung agrees to increase its paid-in capital, which will then be followed by capital participation from the BPD," Arif explained.
He divulged that the holding company was created to strengthen the structure, resilience, and competitiveness of both BPDs in the banking industry. The goal is for banks in a holding company with Bank Jatim could become more competitive regionally and advance the development and economy of their respective regions and Indonesia as a whole.
Mahdi stated that he is confident the BPD holding company will bring many positive changes to Bank Lampung, making it stronger and able to maximize the potential of existing synergies.
"We are confident that synergizing through a holding company with Bank Jatim can have a positive impact on Bank Lampung's business performance. One of the things we will prepare is human resources so that all work programs could be realized properly and optimally," he emphasized.
