Islamic Finance in Indonesia: Waking up the Sleeping Giant

Financial institutions have a largely untapped market in Indonesia’s “digitally enabled but unbanked” population. Providers with digital capabilities are particularly well placed to facilitate transactions, capitalising on the Indonesian government’s drive to promote its domestic Sharia’h-compliant capital market.

This alert will bring to your attention the significant measures the Indonesian government has taken to provide the regulatory environment necessary to germinate and stabilise their Islamic finance market including:

branchless banking;promoting Sharia’h-compliant capital markets; andregulating Sharia’h principles and experts.

As the market grows, digital banking services will become more important for consumers and corporates. As the market matures a...