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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.

Latest News

June 11, 2026

Joko “Jokowi” Widodo’s "safari politik" (campaign tour) since June marks a significant turning point in Indonesia’s post-presidential politics. Although publicly framed as a series of visits to fulfil invitations and meet citizens, the former presidents tour reflects a calculated effort to sustain influence, reorganize political alliances and shape the country’s political future toward the 2029 elections. Rather than a purely symbolic return, the "safari politik" represents a strategic repositioning in a political landscape now led by President Prabowo Subianto.

After completing his presidency in October 2024, Jokowi entered a quieter phase, though he remained highly popular among the public. By late May 2026, he announced plans to travel across Indonesia, beginning with Lampung, East Nusa Tenggara Timur and West Java provinces, after recovering from health issues.

Officially, Jokowi described the visits as responses to invitations from local communities and efforts to maintain social ties. However, the scale of the tour and its timing highlight a broader political context. Jokowi is no longer aligned with the Indonesian Democratic Party of Struggle (PDI-P), the party that supported his presidency from 2014 to 2024, and is increasingly associated with the Indonesian Solidarity Party (PSI), led by his son Kaesang Pangarep.

Jokowi’s safari serves several interconnected goals. First, it is a demonstration of continued political relevance. By visiting multiple regions and mobilizing public enthusiasm, Jokowi signals that his popularity remains strong even after leaving office. Analysts view this as a message to political elites, including Prabowo, that Jokowi still commands a significant grassroots base.

Second, the "safari politik" is widely seen as a strategy to strengthen PSI. Observers argue that Jokowi is leveraging his popularity to boost the party’s electability and potentially help it pass the parliamentary threshold. Since PSI lacks a strong nationwide structure, Jokowi’s personal appeal becomes its most valuable political asset.

Third, the tour reflects a long-term political calculation toward 2029. Analysts suggest Jokowi is maintaining bargaining power in coalition politics while positioning his political network for future competition. This includes indirectly supporting the political trajectory of his son, Vice President Gibran Rakabuming Raka.

Finally, the tour continues Jokowi’s signature blusukan-style engagement, but with a clearer electoral and organizational purpose. It is no longer just about connecting with citizens, it is also about mobilizing supporters and consolidating networks.

The safari provides Jokowi with several strategic opportunities. First, it allows him to maintain national visibility and relevance. Former presidents often lose political influence over time, but Jokowi’s continued presence helps preserve his role as a key political figure and potential kingmaker.

Second, the tour supports his effort to build PSI as a viable political force. By directly engaging with local cadres and communities, Jokowi can help transform the party from a marginal player into a more competitive organization, benefiting from the “coattail effect” of his popularity.

Third, the safari acts as a test of political loyalty. By observing the level of public participation and support, Jokowi can assess whether his influence remains strong outside formal office.

Fourth, it helps him consolidate and expand his support base geographically. By revisiting regions that supported him during past elections, Jokowi strengthens existing networks while potentially reaching new voters. Together, these gains reinforce Jokowi’s position as an influential actor in Indonesia’s political system despite no longer holding power.

For PDI-P, Jokowi’s "safari politik" has significant implications. Symbolically, it confirms the breakdown of Jokowi’s relationship with his old party PDI-P. His growing association with PSI weakens PDI-P’s ability to claim his achievements and legacy as part of its political identity. Strategically, the safari could erode PDI-P’s voter base. Many voters identify more strongly with Jokowi as an individual than with party structures. If Jokowi successfully mobilizes these supporters under PSI, PDI-P risks losing influence in key regions.

Jokowi’s safari also affects President Prabowo’s political environment. On one hand, Jokowi’s engagement may benefit political stability. His high popularity can help maintain public confidence and support for the broader political system. On the other hand, it introduces a form of parallel political influence. By maintaining his own network of supporters, Jokowi ensures that he remains a key figure whose interests cannot be ignored.

Analysts interpret "safari politik" as a signal to Prabowo that Jokowi retains significant leverage in Indonesian politics. Moreover, Jokowi’s efforts to strengthen PSI could alter future coalition dynamics. A more competitive PSI may influence alliances and reshape the balance of power as Indonesia approaches the 2029 elections.

Jokowi’s June 2026 "safari politik" is not merely a routine tour, it is a strategic effort to preserve influence, build a new political base, and shape Indonesia’s political future.

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