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BI revises down its target for sharia financing growth in Indonesia
Sharia financing will still grow but at a slower pace. Instead of the initial between 11 and 13 percent target, the central bank has adjusted it downward to between 8 and 11 percent.
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A teller counts money at a Mandiri Sharia Bank branch office in Menteng, Central Jakarta, in this file photo. (Antara/Audy Alwi)
B
ank Indonesia (BI) has slashed its sharia financing target on account of expected slower GDP growth this year and slow market adoption.
BI’s sharia economic and financial department head Imam Hartono said on Wednesday that sharia financing would still grow but at slower pace. Instead of the initial between 11 and 13 percent target, the central bank adjusted it downward to between 8 and 11 percent.
“This was related to GDP projection that has moved to between 4.6 and 5.4 [percent],” Imam was quoted as saying by Kumparan.
The central bank last month trimmed its GDP growth forecast for 2025 to a range of between 4.6 and 5.4 percent, down marginally from its initial estimate of between 4.7 and 5.5 percent.
Imam said sharia economics are projected to grow by between 4.8 and 5.6 percent this year. He argued that the system for sharia economics is up and running but few have utilized it.
“The bus is actually there. But what we need now is the passengers,” Imam illustrated the situation with an analogy, explaining that Indonesians understand sharia economic theory but those who actually use it are few and far between.
“In the conventional [system], the inclusion is higher than the literacy. But in sharia, the literacy is high but the inclusion is not,” said Imam.
