Jakarta (ANTARA) - The Financial Services Authority (OJK) has launched a road map for the development and strengthening of Islamic banking for the 2023-2027 period to increase Islamic banks' competitiveness.

"This road map gives strategic policy directions for Islamic banks, both in the industry or supply side and the community or demand side," Chief Executive of Banking Supervision at OJK Dian Ediana Rae stated at the launch of the road map here on Monday.

The road map is deemed necessary, as Islamic banking will face a challenge in the form of increasingly high economic growth, as Indonesia progresses to becoming a developed country.

"Welcoming economic growth that is increasingly high going forward and (the progress of) Indonesia becoming a developed country, of course, needs adequate financial synergy from the banking side," he remarked.

It is also deemed essential for Islamic banks to boost their competitiveness, as currently, from 13 Islamic banks and 20 Islamic bank business units operating in Indonesia, only one bank has assets of above Rp100 trillion (around US$6.45 billion).

Meanwhile, 11 Islamic banks and 17 Islamic bank business units have assets of below Rp40 trillion (around US$2.58 billion).

"The current Islamic banking structure shows that the national Islamic banking industry is still on a relatively small business scale, so it is not yet competitive in the national banking industry," he explained.

The 2023-2027 Islamic Banking Development and Strengthening Road Map consists of five pillar policies, including the Islamic banking structure and resilience strengthening policy, Islamic bank digitalization acceleration policy, and Islamic bank characteristics strengthening policy.

They also include the policy to increase the contribution of Islamic banking to the national economy as well as the policy that is expected to make regulations, licensing, and supervision of Islamic banks more responsive and accommodative to the development of Islamic banks.

"Apart from the five main pillars, supporting factors that are very important are strong leadership and effective company management, optimization of technology and resources, as well as synergy and collaboration with stakeholders," he remarked.

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Translator: Sanya Dinda, Raka Adji
Editor: Rahmad Nasution
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