Shariah banking could take 5% of Indonesian banking

Shariah banks’ assets grew to US$21.8 billion in 2012 from 2011.

Bank Indonesia, the central bank, expects the market share of Shariah banking to reach 5% in the second quarter of this year.

Bank Indonesia Governor Agus Martowardojo said the bank believes that progressive Shariah banking and financial development needs to be managed strategically. With the development of a blueprint, the growth of Shariah banking will be more significant, he said.

“To increase the financing contribution of Shariah banking toward the economy, it is important to develop a strong and comprehensive Shariah financial system. That includes Shariah banking, non-Shariah banking and a Shariah stock market,” Agus said.

He noted that there is a strong tie between Shariah banking, the takaful industry, or Islamic insurers, and Shariah stock markets.

Up to 80% of Shariah lending goes to micro, small and medium enterprises. Islamic lenders comply with the Shariah law that prohibits the receipt of interest payments by receiving a pre-arranged percentage of revenue to repay a loan.

Also Read

Malaysia, UK tout Islamic finance to bridge green funding gap

Maybank kicks off Islamic banking operations in the Philippines

Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

I want to download the media kit