"Success indicators for us to reach Golden Indonesia require a lot of development, and financial development is a must," the minister stated during the dissemination of information on the Financial Sector Development and Strengthening Law (UU P2SK) by the Indonesian Chamber of Commerce here on Tuesday.
The minister explained that Indonesia's financial sector should be more dynamic and advanced as well as have broad diversification in order to realize the Golden Indonesia Vision 2045.
Meanwhile, the Indonesian financial sector has, so far, been dominated by banks.
"That does not mean it is bad, but it does not describe financial needs that are increasingly diversified," Indrawati noted.
Moreover, realization of this vision hinges on support from several other aspects, such as volume, diversity of financial instruments, the contribution of business actors and regulatory institutions, as well as consumer protection.
On the other hand, the state treasurer also sees a tendency for the middle class to be limited in determining their financial investment instruments. Moreover, Indonesia's financial regulations are considered to be lagging behind.
These considerations became the basis for the government in issuing Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (UU P2SK).
One of the aspects regulated in the P2SK Law is financial literacy that aims to increase public understanding of the financial sector.
Minister Indrawati stated that the level of banking literacy among Indonesian people is still below 50 percent, while financial technology literacy, or fintech, is still at around 10 percent.
This shows that there are still several people, who do not really understand various products in the financial sector.
Moreover, the pandemic has accelerated technological developments and has had a major impact on the financial sector.
Hence, the minister opined that regulations were needed to be able to adapt to the times while concurrently pushing Indonesia to realize the Golden Indonesia 2045 vision.
"Hence, the indicators are the depth, instruments, regulators, and literacy of the people," the minister remarked.
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Translator: Katriana
Editor: Azis Kurmala
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